Solvay Q2 profit down on pharmaceuticals

27 July 2007 07:24  [Source: ICIS news]

SINGAPORE (ICIS news)--Solvay on Friday reported 4% fall in second quarter recurring earnings before interest and tax (REBIT) from the same period a year ago as growth in plastics and chemicals failed to offset a weaker pharmaceutical segment.

Second quarter REBIT fell to €291m ($398.6m) from €304m in the same period of 2006, the Belgium-based group said in a statement. Sales rose 2% to €2.4bn.

In the chemicals sector, REBIT increased 14% to €96m on strong demand and higher prices for soda ash and caustic soda, Solvay said. Chemical sales rose 2% to €773m.

Its fluoride products remained under heavy pressure as energy costs increased in Europe while prices in the refrigerant market were lower, the company added.

Second quarter REBIT for its plastics divison rose 11% to €126m as sales of vinyl products showed strong growth, Solvay said. Specialty polymers made steady progress and sales rose 5% to €1bn.

Pharmaceutical REBIT fell 32% in the second quarter to €291m and sales were down 3% to €627m.

Results continued to be affected by the unfavorable impact of the US dollar, expiration of marketing rights to drug Pantoloc and significant pressure on prices in the European pharmaceuticals market, especially in France, Solvay said.

"Overall for 2007, we are confident that we can achieve the excellent operating results of last year. Obviously, we remain attentive to the evolution of worldwide macroeconomic conditions, energy costs and the Euro/US dollar exchange rate," it added.

($1 = €0.73)

By: Florence Tan
+65 6780 4359

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