24 September 2009 12:19 [Source: ICIS news]
LONDON (ICIS news)--DSM expects its third-quarter operating profit to be around double the €58m ($85m) recorded in the previous quarter due to improved customer demand, the Netherlands-based specialty chemicals company said on Thursday.
As a result of a better performance by the two material science clusters and the base chemical and materials cluster in July and August, DSM said its third-quarter operating profit from continuing operations before exceptional items was expected to be about €116m.
However, this remains down considerably on the €237m operating profit posted in the third quarter of 2008.
The company saw demand pick up in June and remain through July and August, which is unusual for summer, said DSM chief financial officer Rolf-Dieter Schwalb at a press conference.
“There is no real restocking but destocking has come to an end,” he added.
DSM also expects to post a net profit in the third quarter.
Schwalb said uncertainties about the crisis remained and the company continued to be unsure whether the improved demand would continue in future quarters.
“Our order book is a lot smaller than prior to the crisis,” he said.
The market reacted positively to DSM’s trading update with the share price for the company moving up 3.4% on the Euronext Amsterdam. At 12:54 local time, its shares were trading at €28.23.
The company added that it planned to continue its focus on innovation-related sales and sales and production in emerging economies, as well as carrying on with its disposal programme.
Schwalb said they remained in talks about the sale of its melamine, fertilizer and elastomer businesses with interested parties but refused to give further details.
($1 = €0.68)
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