Interviews
News Flash
Operating margin improves at Clariant
30 Apr '08
4 min read
Improved pricing across the divisions:
All four divisions achieved higher prices in the first quarter as a result of the company's focus on price increases and the corresponding measures that have been initiated in the previous year.
Following Clariant's price over volume approach, the divisions have tackled customers with unsatisfying profitability by price increases, utilization of alternative low cost distribution channels or giving up on unprofitable business. These measures had a slightly negative effect on volumes without having materially impacted capacity utilization.
Pigments & Additives division with strong sales and margin growth:
The Pigment & Additives division grew 6% in local currency (1% in CHF) compared to previous year. This favorable development was mainly influenced by good demand but also partially the result of some inventory build-up by customers.
The main growth driver was the Coatings business that has benefited from robust demand in particular from the automotive industry in Europe and strong growth in Asia. The Specialties, Publication Inks and Plastics businesses also saw good growth in terms of price and volume whereas at different levels.
Geographically, demand in Asia and Latin America gained momentum, whilst sales in Europe were slightly lower. The weakness of the US market had only limited impact on the division's top line due to the relatively small exposure of Pigments & Additives to the USmarket.
The division significantly improved profitability due to price increases and effective cost management, although the gross margin declined slightly on a year-on-year basis.
The division has extended its joint venture with its Chinese partner Zhejiang Baihe in Hang Zhou city, province of Zhejiang. The joint venture will build a new plant for the production of Quinacridone high performance organic pigments. The investment demonstrates Clariant's strong focus on the emerging markets in Asia and in particular on mainland China, where the company already operates nine facilities.
Textile, Leather & Paper Chemicals challenged by unfavorable market conditions:
The performance of the Textile, Leather & Paper Chemicals division was impacted by difficult, however different, market environments for all three businesses. Sales in local currency declined 6% (11% in CHF). The gross margin declined compared to the first quarter of 2007.
Click here to view more:
All four divisions achieved higher prices in the first quarter as a result of the company's focus on price increases and the corresponding measures that have been initiated in the previous year.
Following Clariant's price over volume approach, the divisions have tackled customers with unsatisfying profitability by price increases, utilization of alternative low cost distribution channels or giving up on unprofitable business. These measures had a slightly negative effect on volumes without having materially impacted capacity utilization.
Pigments & Additives division with strong sales and margin growth:
The Pigment & Additives division grew 6% in local currency (1% in CHF) compared to previous year. This favorable development was mainly influenced by good demand but also partially the result of some inventory build-up by customers.
The main growth driver was the Coatings business that has benefited from robust demand in particular from the automotive industry in Europe and strong growth in Asia. The Specialties, Publication Inks and Plastics businesses also saw good growth in terms of price and volume whereas at different levels.
Geographically, demand in Asia and Latin America gained momentum, whilst sales in Europe were slightly lower. The weakness of the US market had only limited impact on the division's top line due to the relatively small exposure of Pigments & Additives to the USmarket.
The division significantly improved profitability due to price increases and effective cost management, although the gross margin declined slightly on a year-on-year basis.
The division has extended its joint venture with its Chinese partner Zhejiang Baihe in Hang Zhou city, province of Zhejiang. The joint venture will build a new plant for the production of Quinacridone high performance organic pigments. The investment demonstrates Clariant's strong focus on the emerging markets in Asia and in particular on mainland China, where the company already operates nine facilities.
Textile, Leather & Paper Chemicals challenged by unfavorable market conditions:
The performance of the Textile, Leather & Paper Chemicals division was impacted by difficult, however different, market environments for all three businesses. Sales in local currency declined 6% (11% in CHF). The gross margin declined compared to the first quarter of 2007.
Click here to view more:
Clariant International Ltd
Popular News
Leave your Comments
Editor’s Pick
Esteemed Clients
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Telangana State Industrial Infrastructure Corporation Limited (TSllC Ltd)")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Taiwan Textile Federation (TTF)")
