UpdateLANXESS Q3 net profit surges to €118m on strong demand

10 November 2010 10:36  [Source: ICIS news]

(adds additional sales figures and quotes from chairman throughout)

LONDON (ICIS)--LANXESS reported a third-quarter net profit of €118m ($164m), a sharp increase from €23m in the same period last year, due to strong demand for its synthetic rubber and high-tech plastics, Axel Heitmann, chairman of the board of management, said on Wednesday.

The German specialty chemicals producer's sales in the July-September period rose 35% year on year to €1.85bn, while earnings before interest, tax, depreciation and amortisation (EBITDA) pre-exceptionals rose 71% to €244m.

Group sales were boosted by higher volumes in key customer industries, positive currency effects and price increases, which fully-offset higher raw material costs, Heitmann said.

“A major factor here are the portfolio areas of synthetic rubbers and high-tech plastics, which also included our 10 best-selling products in the third quarter," Heitmann added.

"The products of both areas are in great demand worldwide, mainly from the global automotive and tire industries. Both sectors are benefiting from the growing demand for mobility, especially in the emerging markets of Asia and Latin America," he said.

Sales of LANXESS’s performance polymers segment rose 50% year on year to €986m in the third quarter, driven by price increases and strong demand, notably in Latin America.

Heitmann said that all the business units in this segment felt a positive trend particularly from brisk demand in the replacement tyre business and the automotive industry. 

“Particular growth opportunities are opening up for us in rubbers for environmentally friendly, “green” high-performance tyres,” he added.

Third quarter sales in the group's advanced intermediates segment rose 18% year on year to €336m, supported by the integration of acquired basic chemical activities in India and China.

Sales of LANXESS’s performance chemicals segment rose 21% year-on-year to €515m in the third quarter, with all seven business units showing sales improvements, due to improved demand as volumes rose by more than 10%, Heitmann said.

Looking ahead, Heitmann said that LANXESS was targeting EBITDA pre-exceptionals of around €900m for the business year 2010 – double the earnings it achieved in 2009, and to increase EBITDA pre-exceptionals to around €1.4bn by 2015, first announced in September.

“We are in growth mode and will be rolling out our planned investments in the coming months in order to capitalise on the mega-trends - especially mobility - in China, India and Brazil,” Heitmann said.

The company would also make a final decision on a neodymium polybutadiene rubber plant in Asia in the coming months, the statement added.

($1 = €0.72)

Additional reporting by Nurluqman Suratman
To discuss issues facing the chemical industry visit ICIS connect


By: Franco Capaldo
+44 (0)20 8652 3214



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