Clariant delivers solid performance in difficult environment

27 Jul '11

5 min read

The acquisition of Süd-Chemie led to an increase in net debt to CHF 1,791 million from CHF 126 million at year-end, resulting in a gearing (net debt divided by equity) of 62% at the end of the second quarter of 2011. With the issuance of two Swiss franc bonds totaling CHF 250 million, the debt maturity profile has been extended at favorable conditions until 2015/17. The size of the bond issue has been increased by another CHF 50 million in July.

Update on Süd-Chemie acquisition
On April 21, Clariant completed the purchase of 96.15% of the shares in Süd-Chemie from One Equity Partners and the family shareholders. A public offer to acquire the shares from Süd-Chemie minority shareholders expired on June 14. Clariant acquired an additional 2.49% of Süd-Chemie, bringing the total shares acquired to 98.64%. The squeeze-out procedure to acquire all of the remaining shares in Süd-Chemie AG from minority shareholders was initiated on June 24 and is expected to be completed in the first half of 2012.

The integration process got underway in April. All project teams are fully operational and the integration is progressing according to plan.

In the second quarter, the consolidation of Süd-Chemie for two months contributed CHF 216 million in sales, CHF 34 million in EBITDA and CHF 17 million in EBIT before exceptional items.

Outlook 2011
At the beginning of 2011, Clariant shifted its focus from restructuring to continuous improvement and profitable growth. While the continuous improvement initiative “Clariant Excellence” will make the competitive cost basis sustainable, the company is now focusing on creating value by investing in future profitable growth.

Clariant expects a more difficult but nevertheless solid business environment in H2 2011, characterized by a softening demand. Exchange rates for the major currencies are expected to remain volatile. Commodity prices look set to continue to rise in the second half-year 2011, leading to an increase in raw material costs in the mid-teens compared to 2010.

For 2011, Clariant – including eight months of consolidated Süd-Chemie figures – expects sales in the range of CHF 7.8 to 8.0 billion and an EBITDA margin before exceptional items of 13.5% to 14.5%.

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Clariant International Ltd

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