Clariant AG: Clariant delivers solid Q2 with improved profitability and cash flow
(Thomson Reuters ONE) -
Clariant AG /
Clariant AG: Clariant delivers solid Q2 with improved profitability and cash
flow
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* Second quarter 2015 sales from continuing operations remained stable in
local currencies. In Swiss francs, sales decreased 8 % to CHF 1.406
billion from CHF 1.531 billion compared to last year
* EBITDA margin before exceptional items improved significantly to 15.0 %
from 14.0 %
* Cash flow clearly improved to CHF 51 million compared to CHF -62
million in second quarter 2014
* Net result from continuing operations at CHF 56 million compared to CHF
83 million
* 2015 outlook confirmed
"Clariant continued the strong development of the first into the second
quarter," said CEO Hariolf Kottmann. "We have significantly improved our
operating profitability and our cash flow. This is in-line with our objectives
for 2015 and we expect cash generation to continue to increase in the second
half of the year. Clariant is well on track to achieve its growth and
profitability targets, despite a continued mixed economic environment
particularly in Asia and very volatile currencies."
Key Financial Data
-------------------------------------------------------------------------------
Continuing operations: Second quarter First half-year
-------------------------------------------------------------------------------
in CHF million 2015 2014 % CHF % LC 2015 2014 % CHF % LC
Sales 1'406 1'531 -8 0 2'871 3'023 -5 2
EBITDA before exceptional 211 214 -1 9 417 424 -2 9
items
- margin 15.0 % 14.0 % 14.5 % 14.0 %
EBIT before exceptional 148 145 2 15 290 285 2 14
items
- margin 10.5 % 9.5 % 10.1 % 9.4 %
EBIT 133 128 4 17 272 169 61 79
Net result from continuing 56 83 143 44
operations
-------------------------------------------------------------------------------
Net income(1) 56 74 143 26
Operating cash flow(1) 51 -62 65 -113
Number of employees(1) 17 030 17 003*
Discontinued operations
Sales 0 32 0 98
Net result from 0 -9 0 -18
discontinued operations
-------------------------------------------------------------------------------
(1 )Total group including discontinued operations
* as of 31 December 2014
Second quarter 2015 -Significantly improved EBITDA margin and better cash flow
Muttenz, 30 July 2015 - Clariant, a world leader in specialty chemicals, today
announced second quarter 2015 sales from continuing operations of CHF 1.406
billion compared to CHF 1.531 billion in the second quarter of 2014. This
corresponds to a flat growth in local currencies, influenced by 1 % lower
volumes and 1 % higher prices.
Given the continuing strong volatility of currencies in the second quarter of
2015, in particular the year-on-year weaknesses of the euro, Brazilian real, and
the Japanese yen, the flat sales development in local currencies translated into
an 8 % sales reduction in Swiss francs.
Growth was focused in the Americas with Clariant posting strong local currency
sales growth of 16 % in Latin America and 7 % in North America, the latter led
by strong demand in Catalysis as well as continued growth in Oil & Mining
Services. Europe was 2 % lower in local currencies but basically continued to be
flat if the reduction of the exposure to the low-margin base products business
is taken into account.
The lower growth was mostly due to the regions Asia/Pacific and Middle East &
Africa. In Asia/Pacific sales in local currencies decreased by 5 %. The decline
was due to weak demand in China and to a high base in the Catalyst business,
where in addition second quarter orders were shifted into the first quarter of
2015. The strong development in smaller economies in Asia could not compensate
for this base effect. In the Middle East & Africa region, sales were 21 % lower
year-on-year in local currencies, because of a higher basis in the second
quarter of 2014, which still included sales from the Water Treatment business,
which was divested in July 2014.
The three high margin Business Areas, Care Chemicals, Catalysis, and Natural
Resources experienced strong underlying demand and are all on track to reach
their respective yearly guidance.
Care Chemicals recorded a like-for-like growth of 9 %. Reported growth was 3 %,
exclusively due to the reduction of exposure to the low-margin base products in
2014. Sales in Catalysis decreased by 9 % in local currencies as expected, due
to a high base in the second quarter of 2014 and the shift of orders from the
second into the first quarter of 2015. Natural Resources revenues increased by
1 % with an underlying growth of 6 % in local currencies when accounting for the
sale of the Water Treatment business. Growth continued to be driven by Oil &
Mining Services. In Plastics & Coatings, however, sales remained flat, as stable
growth in the Masterbatches business could not compensate for the weakness in
Pigments.
At 30.7 %, the gross margin was above previous year's level (29.5 %) benefitting
from higher pricing. The increased gross margin was the main driver for the
strong EBITDA margin before exceptional items improvement.
The EBITDA before exceptional items from continuing operations rose 9 % in local
currencies and reached CHF 211 million, compared to CHF 214 million recorded in
the previous year. The corresponding EBITDA margin of 15.0 % was clearly above
the previous year's level of 14.0 %.
Care Chemicals, Natural Resources, as well as Plastics & Coatings substantially
improved EBITDA margins in the second quarter of 2015 in comparison to the
previous year. Catalysis delivered a solid 23.9 % EBITDA margin, which was lower
than in the previous year, when the comparable base was uncommonly high due to
portfolio mix effects.
Exceptional items including restructuring, impairment, and transaction-related
costs decreased significantly to CHF 16 million compared to CHF 23 million in
the second quarter of 2014. This was due to lower restructuring costs in the
second quarter of 2015.
Net income from continuing operations amounted to CHF 56 million compared to
CHF 83 million in the previous year. This decline was basically due to
extraordinarily low tax expenses in the second quarter of 2014 that were driven
by one-time events.
Operating cash flow improved to CHF 51 million versus CHF -62 million one year
ago, on lower build-up of net working capital. This is a clear reflection on
Clariant's priority to increase cash flow in 2015. Cash generation is expected
to continue to increase in the second half of the year.
Net debt was CHF 1.347 billion compared to CHF 1.263 billion recorded at year-
end 2014. The gearing, reflecting net financial debt in relation to total equity
rose to 58 % from 46 % at the end of 2014.
Separate subsidiary for Business Area Plastics & Coatings to be established
Clariant intends to establish a subsidiary for the Business Area Plastics &
Coatings comprised of the Business Units Masterbatches, Additives and Pigments,
in order to fully leverage their value creation potential for the company. This
will enable Plastics & Coatings to be steered towards higher absolute
profitability and cash generation. The new subsidiaries across the world will be
fully owned by Clariant and will start operating as of 1 January 2016.
"In the last few years our Business Units Masterbatches, Pigments and Additives
have established themselves as leaders in their respective markets in terms of
profitability and market share. The new Plastics & Coatings subsidiary will
further enable differentiated business steering with a clear focus on absolute
profitability and cash generation to further safeguard and improve competiveness
in already mature markets. This set up will further increase value creation for
the Group. That is why, the entity will remain a vital part of the Group," said
CEO Hariolf Kottmann. "This step will also enable us to make appropriate
investments in our growth areas", he added.
The existing business unit structure with Masterbatches, Additives and Pigments,
will be maintained with all approximately 7'000 employees, all assets and
liabilities. Sales of the Business Area Plastics & Coatings were CHF 2.6 billion
in 2014; the reported EBITDA margin before exceptional items was 14.0 %.
Outlook 2015 confirmed - Further progress in sales, profitability and cash
Clariant expects the challenging environment characterized by an increased
volatility in commodity prices and currencies, to continue.
In emerging markets, the economic environment is expected to remain favorable,
but at a lower level and with increased volatility. Moderate growth should
continue in the United States. However, growth in Europe is expected to remain
weak.
The combined effect of the appreciation of the Swiss franc with the weakening of
the euro will impact Clariant's sales and profitability in absolute terms, but
it will continue to be fairly neutral in terms of relative margins.
In 2015, Clariant is continuing to improve its operational efficiency by
implementing a lean service organization; it is further improving its marketing
excellence and continues to launch innovations that generate value for its
customers.
For 2015, Clariant expects low to mid-single digit sales growth in local
currencies. The company will further increase its EBITDA margin before
exceptional items above full-year 2014 and increase cash flow generation.
Clariant confirms its mid-term target to achieve a position in the top tier of
the specialty chemicals industry. This corresponds to an EBITDA margin before
exceptional items in the range of 16 % to 19 % and a return on invested capital
(ROIC) above the peer group average.
Media Release EN:
http://www.clariant.com/Q2_2015_EN
Media Release DE:
http://www.clariant.com/Q2_2015_DE
Financial Review:
http://www.clariant.com/Q2_2015_FinRev
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originality of the information contained therein.
Source: Clariant AG via GlobeNewswire
[HUG#1942246]
Unternehmensinformation / Kurzprofil:
Datum: 30.07.2015 - 07:00 Uhr
Sprache: Deutsch
News-ID 410244
Anzahl Zeichen: 12265
contact information:
Town:
Muttenz 1
Kategorie:
Business News
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