16 May 2013 10:30 [Source: ICIS news]
LONDON (ICIS)--Synthos saw is first-quarter net profit fall to zloty (Zl) 135.0m ($41.5m, €32.3m) from Zl 234.8m a year ago with its performance hit by poor demand on the European market for replacement tyres, the major Polish synthetic rubber producer said on Thursday.
Revenues declined to Zl 1.4bn from Zl 1.6bn, while operating profit came in at Zl 152.9m, compared to Zl 279.7m in the first quarter of last year, it added.
“[We have seen] poor demand on the European market of replacement tyres,” Synthos said in a commentary on its latest financial results, citing figures from the European Tyre and Rubber Manufacturers' Association showing sales of 45.6m units in the first quarter of this year compared to 53.2m units in the same period of 2012.
“It should be noted that in northern Europe demand remained stable, in contrast to southern Europe, where it decreased significantly due to economic recession,” it added.
“Given the tough operating environment in Q1, monomer spread compression and benchmark ESBR [emulsion styrene butadiene rubber] price declines, we view Synthos’s Q1 results as relatively resilient,” Piotr Drozd, a chemical industry analyst at WOOD & Company investment bank, said.
“However, we believe that Q2 may prove to be a more difficult quarter as, without the support of rising butadiene (BD) prices in Asia, spurring optimism among market participants and against the gloomy outlook on European tyre sales, Synthos may face stronger operating headwinds in Q2, resulting in weaker quarter on quarter sales volumes,” he added.
($1 = €0.78, $1 = Zl 3.25, €1 = Zl 4.18)
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