25 March 2010 10:20 [Source: ICIS news]
SINGAPORE (ICIS news)--German producer Evonik Industries said on Thursday its chemicals business posted an 88% year-on-year surge in fourth-quarter earnings before interest, tax, depreciation and amortisation (EBITDA) at €435m ($580m), largely due to cost cutting.
Sales for the three-month period ending 31 December 2009 increased to €2.66bn from €2.63bn in the same period in 2008, as higher product demand was partly offset by weaker prices, the company said in a statement.
For the full year of 2009, Evonik’s chemical business EBITDA just slipped 1% to €1.6bn, although sales fell a steeper 15% to €9.98bn. The company managed to save more than €500m last year, it said.
“Thanks to extensive action to safeguard liquidity and earnings and cost savings, the year-on-year decline in EBITDA of 33% registered at mid-year had been almost entirely eliminated by year end,” the company said.
The Evonik group posted a full-year net income of €240m, down 15% from a year ago.
“Following a difficult start to 2009, in the second half of the year we managed to make up for much of the sharp downturn in the operating result, principally through strict cost discipline and by raising efficiency,” said Klaus Engel, group chairman of the executive board.
“We reduced net financial debt massively, by a quarter. That is the most rapid reduction in debt in the past four years,” he added.
Evonik’s 2009 sales, meanwhile, declined 18% to €13.1bn.
Looking ahead, the group said it expects its 2010 EBITDA to be flat year on year, although sales should be higher than 2009.
The company’s restructuring efforts should generate annual savings of around €500m for the group starting 2012, Evonik said.
“In view of the expected improvement in business, Evonik is planning to step up capital expenditures substantially compared with 2009,” it said.
($1 = €0.75)
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