SGL Carbon’s H1 operating profits show 54% rise

25 July 2007 08:00  [Source: ICIS news]

SINGAPORE (ICIS news)-- SGL Carbon on Wednesday posted a 54% year-on-year rise in first-half operating profits due to positive selling prices and sales volumes and high capacity utilisation, and also raised its guidance for the full year.

 

The German specialty chemicals firm recorded first-half operating profit of €122m ($169.4m), compared with €79.2m in the same period last year.

 

First-half consolidated sales rose 14% to €647.5m, with all three business units contributing to growth, SGL Carbon said. Net profits after minority interests surged to €49.4m, from €1m in 2006.

 

In the company’s performance products segment, sales revenues grew 15% to €387.1m in the first half due to continuing strong demand from the steel sector and growing demand from the aluminium industry.

 

Despite higher raw materials and electricity costs as well as negative currency

translation effects, earnings before interest and tax (EBIT) in the first half rose 49% to €113.6m year on year, SGL Carbon said.

 

In the firm’s graphite materials and systems sector, first-half sales revenue rose 7% to €177.4m. All three business lines, namely graphite specialties, process technology and expanded graphite, contributed to growth with strong demand coming especially from the semi-conductor, solar, lithium-ion battery and chemicals industries.

 

The company’s carbon fibres and composites (CFC) segment saw first-quarter sales revenues grow 26% to €79.9m. A temporary interruption of carbon fibre production at its Inverness, UK, facility caused some shipment delays which negatively impacted earnings. These delays, however, were expected to be made up for in the course of the year, the firm said.

 

On 13 June, SGL said it would build a third major production line for carbon fibres at Inverness. With commissioning by the end of 2008, its production capacity would rise to about 5,000 tonnes/year, it said.

 

In order to meet strong demand, the company also planned to build a new carbon fibre site in Germany with capacity of between 3-6,000 tonnes/year.

 

For the third quarter, SGL Carbon expected a double-digit increase in consolidated sales and EBIT compared with the same quarter in 2006.

 

It also raised its guidance for the full year and said it expected consolidated sales to grow 10-15% overall compared with 2006 and EBIT to improve by 45%. SGL Carbon also forecast capital expenditure to reach €120m in 2007, due to growth strategies in the area of advanced materials and cathodes.

 

($1 = €0.72)

By: Jeanne Lim
+65 6780 4359

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