Belgium's Tessenderlo swings to Q2 loss on divestment charges

29 August 2012 10:37  [Source: ICIS news]

LONDON (ICIS)--Tessenderlo swung to a loss of €15.1m ($18.9m) in the second quarter of 2012 compared with a profit of €22.4m in the corresponding period last year, primarily on the back of non-recurring charges of €35.9m, the Belgium-based chemicals firm said on Wednesday.

The charges relate to the intended divestment of the group’s continental European profiles activities and the sale of its Chinese organic chlorine derivatives activities on 21 August to a Hong Kong-based private investment firm.

In a second-quarter earnings release, Tessenderlo announced the intention to divest its continental European profiles activities, know as Profialis, to US-headquartered global private investment company OpenGate Capital.

Profialis, which according to Tessenderlo’s website offers several PVC systems for windows and doors, includes two production facilities in France and in Belgium, and distribution centres in Hungary and Poland. Financial details of the deal were not disclosed.

The group’s second-quarter revenue grew 4.0% year on year to €563.3m, driven by strong growth for Tessenderlo Kerley and the group’s Gelatin & Akiolis business.

The company added that revenue from its Other Businesses and Inorganics segments was marginally lower than in the second quarter of 2011, while its Plastic Pipe Systems segment saw sales down on last year’s second quarter as construction activity continued to be weak.

Tessenderlo’s recurring earnings before interest, tax, depreciation and amortisation (REBITDA) in the second quarter of 2012 decreased by 8.2% year on year to €55.7m.

Looking ahead, Tessenderlo maintained a cautious view and said taking into account the group’s traditional higher weighting in the first half of the year, demand for most of the group’s activities in the second half is anticipated to be slightly lower when compared with the same period of 2011.

“Construction end markets are expected to stay challenging in the countries where the group is active, impacting Plastic Pipe Systems and Profiles. Food and agriculture markets should continue to be attractive going forward despite extreme summer weather conditions in the US and continued margin pressures in Inorganics,” it added.

($1 = €0.80)

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

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