In Q1 2018, Wacker posted earnings before interest, taxes, depreciation and amortisation (EBITDA) of €254.5 million. That was 11 per cent higher than last year (€229.3 million) and 9 per cent more than in Q4 2017 (€233.4 million). Primary drivers of this robust growth were better prices for chemical products and higher income from the stake in Siltronic. As a result, Wacker more than compensated for the marked year-over-year and quarter-over-quarter increase in raw-material costs. Earnings also benefited from strong plant utilisation in the reporting quarter.
Net income totaled €79.1 million in the reporting quarter (Q1 2017: €665.9 million). The high year-ago figure included net income of €634.7 million from discontinued operations in connection with the deconsolidation of Siltronic as a Wacker segment. Income from continuing operations, on the other hand, more than doubled at €79.1 million (Q1 2017: €31.2 million). Earnings per share came in at €1.52 in the reporting quarter (Q1 2017: €13.19).
"Wacker performed well in Q1 2018," said CEO Rudolf Staudigl. "Despite strong currency headwinds, we matched our good sales of a year ago. At the same time, we achieved a substantial increase in EBITDA in spite of markedly higher raw-material prices and ongoing costs at our Charleston, Tennessee site, where production was still shut down in the first quarter. We are now starting the process of gradually ramping up the site. This means that we will again have polysilicon from Charleston available for sale in the second quarter. Our chemical business performed robustly in the reporting quarter, with silicones experiencing especially strong demand. In this market environment, we achieved substantial price increases. Provided this trend continues, and no unexpected events impact the global economy, we may even exceed our current full-year earnings forecast."
Wacker anticipates that business will experience higher raw-material costs and headwinds from a stronger euro against the US dollar in 2018. Given these underlying conditions, group sales are expected to increase by a low-single-digit percentage. EBITDA growth should continue – increasing by a mid-single-digit percentage versus last year. Wacker expects its EBITDA margin to be slightly higher than a year ago. Depreciation of about €550 mil-lion will be significantly lower than a year ago. Wacker expects group net income from continuing operations to rise markedly. Net cash flow is forecast to be clearly positive, but substantially below last year’s figure, due to higher capital expenditures. Net financial debt will remain on par with last year. (RR)
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