Following a good second quarter 2017, specialty chemicals company LANXESS continues to expect the highest earnings in the company’s history for the current financial year.Global sales of the company increased by almost 30 percent to EUR 2.5 billion, up from EUR 1.9 billion a year earlier. EBITDA pre exceptionals improved by around 25 percent to EUR 367 million, compared with EUR 293 million in the prior-year quarter. This increase was primarily due to the earnings contribution from the newly acquired Chemtura businesses as well as to higher volumes and selling prices. The EBITDA margin pre exceptionals in the second quarter of 2017 stood at 14.6 percent, which was slightly below the high value of 15.1 percent reported in the prior-year period.
“Our growth strategy is paying off. Our strong operating performance and our profitable acquisitions are the basis for our strong results in the second quarter. The newly acquired Chemtura businesses are already making a significant earnings contribution, and the other areas of our speciality chemicals portfolio are also developing positively,” said LANXESS CEO Matthias Zachert.
Due to one-time exceptional charges, net income was EUR 3 million, after EUR 75 million in the prior-year quarter. The one-time effects resulted from the Chemtura acquisition and the planned closure of chrome chemicals production at the Zárate site in Argentina in the fourth quarter of 2017. Adjusted for these effects, net income increased by around 75 percent to EUR 141 million, compared with EUR 80 million in the second quarter of 2016.
“We are overall well on track and continue to expect record earnings for the full year. However, compared with the very strong prior year, we are anticipating a slightly weakened momentum for the second half of 2017,” said Zachert.
LANXESS continues to forecast EBITDA pre exceptionals for the full year 2017 of between EUR 1.225 billion and EUR 1.3 billion. The company achieved its highest operating result to date in 2012, when it posted a figure of around EUR 1.2 billion.
Reporting in new segment structure
At the end of April, LANXESS completed the acquisition of U.S. chemical company Chemtura and subsequently adjusted its Group structure. With immediate effect, LANXESS is reporting on five segments comprising a total of twelve business units.The Advanced Intermediates segment covers the intermediates and agrochemicals businesses. The new Specialty Additives segment bundles additives activities. The Performance Chemicals segment is made up of the business units responsible for color pigments, leather chemicals, material protection products and water treatment technologies. The Engineering Materials segment comprises the businesses for high-performance plastics and urethanes. The ARLANXEO segment encompasses the synthetic rubbers business. In segment reporting, prior-year figures were restated where necessary.
