28 August 2012 11:38 [Source: ICIS news]
LONDON (ICIS)--Yule Catto & Co’s profit in the first half of 2012 rose by 3.9% year on year to £42.6m (€53.9m, $67.6m), as the company’s acquisition of Germany-based emulsion polymer producer PolymerLatex helped to lift its business in Europe, the UK specialty chemicals company said on Tuesday.
The comparable 2011 first-half results are presented on a pro-forma basis – as if the acquisition of PolymerLatex had become effective from 1 January 2011. Yule Catto acquired PolymerLatex for €443m in March 2011.
Group sales for the six months ended 30 June 2012 declined by 9.2% year on year to £603.3m, mainly because of lower volumes, which fell 9.5% compared with the first half of 2011.
Yule Catto’s operating profit increased by 5.3% year on year to £62.1m because of cost-savings achieved through the PolymerLatex acquisition and good margin management across its European business. The company said this more than offset a competitive environment in its nitrile latex business in Asia, and the effect of the weaker euro.
"We have delivered a solid set of results in a challenging environment driven by a strong performance in Europe and North America, which accounted for 84% of our profits,” said Adrian Whitfield, group CEO.
“The PolymerLatex acquisition has significantly enhanced our product portfolio and reach, as well as provided additional cash resources which we are using to invest in emerging markets and innovation to position us for future growth,” he added.
“As previously announced, the nitrile latex business experienced a difficult competitive environment, driving a weaker performance in that part of our Asia and [rest of world] business, with the rest of the portfolio making good progress,” Whitfield said
Chairman Neil Johnson said: “As expected, the acquisition of PolymerLatex has significantly benefited our business in Europe, delivering increased scale, an enhanced product portfolio, stronger market positions and greater efficiencies. The strength of our business in Europe underpins Yule Catto's long-term growth strategy, providing the necessary cash generation to accelerate its growth into emerging markets.”
Looking ahead, Whitfield said: “Assuming there is no further deterioration in the global economy, the board's expectations remain unchanged from the June trading update, for full-year underlying profit before tax ahead of 2011 pro-forma of £96m.”
(€1 = £0.79, $1 = £0.63)
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