Strong demand in Asia/Pacific boosts Cognis textile

23 Aug '07

4 min read

In the first six months of 2007, global specialty chemicals company Cognis increased its net external sales by 6.2 percent to 1,821 million euros on a comparable currency basis. Currency effects reduced the sales growth to 3.5 percent, reaching 1,775 million euros.

The operating result (Adjusted EBITDA) of 214 million euros could match the high level of the first half year in 2006 in spite of a massive rise in raw material costs, especially for natural oils and fats. Together with a successful cost management, the necessary selling price increases could be achieved in many areas, but will show effect with the usual time delay.

Return on sales (Adjusted EBITDA as a percentage of sales) stood at 12 percent. Earnings before interest and taxes (EBIT) fell slightly down 1.4 percent to 119 million euros. Excluding exceptional items, Cognis recorded a net profit of 39 million euros.

It was distorted by one-time effects as a result of the company's refinancing transactions in May and June. The early redemption of the existing bonds and loans lead to a depreciation of connected financing fees, resulting in a net loss of 17 million euros.

“We are pleased with the first half-year. Our Care Chemicals, Nutrition & Health and Functional Products strategic business units, with their focus on innovation-driven growth markets, have made particularly important contributions to our encouraging figures,” says Cognis CEO Antonio Trius.

“Furthermore, we were able to conduct a successful refinancing. In doing so, we achieved a considerable reduction in financing costs of about 74 million euros on average per year, and improved our liquidity position going forward.”

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