Lanxess reports worldwide sales growth in all segments
Specialty chemicals company LANXESS AG has continued on its path of growth and is increasing its earnings forecast for the full year 2008. The company now expects EBITDA pre exceptionals to come in at between EUR 710 million and EUR 730 million.
Thanks to its leading market positions and regionally diversified product portfolio, LANXESS is confident of achieving operational sales growth for the current year as a whole. “Following a very successful third quarter, we are raising our earnings forecast for 2008,” said Axel C. Heitmann, Chairman of the Board of Management of LANXESS AG.
Third-quarter 2008 business performance:
The operating result (EBITDA) pre exceptionals rose by a substantial 9.1 percent against the same period of last year, to EUR 191 million (Q3 2007: EUR 175 million).
The EBITDA margin pre exceptionals grew by 0.2 percentage points year on year to 10.5 percent despite the continued weakness of the U.S. dollar. Sales improved by 6.4 percent to EUR 1,814 million (Q3 2007: EUR 1,765 million). Adjusted to reflect for portfolio and currency effects, LANXESS recorded strong operational sales growth of 13.6 percent.
Group net income in the third quarter amounted to EUR 56 million, against EUR 75 million in the prior-year period. The decline was attributable to the weaker financial result, which was boosted in the prior-year quarter by gains from the divestment of non-core businesses.
Performance by segment:
All segments grew sales in the third quarter. Throughout the Group, the increases in raw material and energy costs were again successfully passed on to the market through selling price increases.
Sales in the Performance Polymers segment rose by a substantial 40.6 percent in the third quarter of 2008, to EUR 938 million (Q3 2007: EUR 667 million). Significant growth in raw material and energy costs prompted considerable increases in selling prices, with volumes slightly down and currency effects negative. Sales advanced accordingly by 24.3 percent on prices alone.
The inclusion of the Brazilian Petroflex group resulted in additional growth of 26.7 percent. EBITDA pre exceptionals of the segment improved by a very significant 33.7 percent to EUR 127 million (Q3 2007: EUR 95 million). The EBITDA margin was down only slightly year on year, dipping by 0.7 percentage points to 13.5 percent.
Sales in the Advanced Intermediates segment, at EUR 344 million, were distinctly above the prior-year level of EUR 298 million. This was due to a significant 10.7 percent expansion of volumes. The 2.0 percent negative impact from shifts in exchange rates was more than offset by price increases of 6.7 percent prompted by the rise in raw material costs. EBITDA pre exceptionals of the segment, at EUR 40 million, was on a par with the year-earlier figure of EUR 41 million. Held back by the passing-on of raw material cost increases and by currency effects, thesegment's EBITDA margin decreased from 13.8 to 11.6 percent.