Strong Q2 prompts Lanxess to raise full year guidance
Specialty chemicals company Lanxess raised its guidance for the full year 2015, following a strong second quarter in the current year.
“Lanxess now expects to achieve EBITDA pre exceptionals between €840 million and €880 million as against, between €820 million and €860 million it had projected earlier,” a Lanxess press release said.
“In the second quarter of this year, we posted a very good operating result to which all segments of our company contributed,” chairman Matthias Zachert said.
“On the basis of these strong figures and the rapid implementation of our realignment program, we assume that our annual result will be higher than previously anticipated,” he informed.
Lanxess increased its guidance on the back of EBITDA pre exceptionals expanding by 13 percent in the second quarter ended June 30, 2015 from €239 million to €270 million in the prior year second quarter.
“This development was driven by increased volumes, savings generated by the realignment, and positive currency effects due to the strong US dollar.” it explained.
EBITDA pre exceptionals margin in the reporting quarter too grew to 12.8 per cent as against 11.8 percent in the second quarter of 2014.
In the quarter under review, sales improved by 4.3 per cent to €2.1 billion, compared with €2.0 billion in the previous year's corresponding quarter.
“Higher volumes and positive currency effects more than offset the raw material induced lower selling prices,” the German company said.
Driven by operational development and proceeds from the sale of noncurrent assets, net income zoomed 58.2 per cent to €87 million from €55 million a year earlier.
At around €1.4 billion, net financial liabilities were almost at the same level as at the end of 2014.
Following the completion of major projects in Asia, capital expenditures declined by more than half in the second quarter against the prior-year quarter from €154 million to €73 million.
“The financial consolidation measures we have implemented as part of our realignment process are taking effect,” said Lanxess CFO Michael Pontzen.
“This development was recently rewarded by the rating agencies Moody's and Standard & Poor's when both confirmed our investment-grade rating with stable outlook,” he added.
The three-phase realignment program initiated by the company last year continues to progress on schedule it informed, and it has already successfully implemented the first phase.
Measures of the second phase, aimed at improving operational competitiveness, have also been initiated.
They include the reorganisation of the production networks for its rubber types EPDM like ethylene propylene diene monomer and Nd-PBR's like neodymium-based performance butadiene rubber.
The third phase of the program is focused on improving the competitiveness of the business portfolio, especially through potential alliances in the rubber business. (AR)
Fibre2Fashion News Desk – India