31 October 2013 11:51 [Source: ICIS news]
LONDON (ICIS)--Evonik Industries’ net income surged to €1.47bn ($2.01bn) in the third quarter of 2013 from €355m in the same period last year because of a one-time gain from a divestment of real estate, the German specialty chemicals firm said on Thursday.
Adjusted net income, which does not contain either the impact of adjustments or the discontinued operations, declined by 38% to €210m in the third quarter, on the back of lower sales.
Third-quarter group sales decreased by 4% year on year to €3.24bn, with organic sales down 1%. Evonik said a perceptible rise in volumes (+5 percentage points) largely offset the drop in prices (-6 percentage points), while exchange rates clipped sales by 1 percentage point.
The remaining minus 2 percentage points of the sales fall were mainly related to the group's cyanuric chloride business in China, which was sold in December 2012, the company added.
Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) fell by 26% to €518m and adjusted earnings before interest and taxes (EBIT) shrank by 32% to €375m.
Evonik said the operating results fell short of the “very high prior-year results”, mainly because of lower selling prices for some key products, particularly butadiene and amino acids for animal nutrition.
The adjusted EBITDA margin was 16.0%, below the previous year's “exceptionally good level” of 20.9%.
“Evonik did well, even though the global economic situation was still difficult,” said Klaus Engel, chairman of the executive board of Evonik.
"Between July and September our operating results improved slightly compared with the second quarter of 2013. The perceptible year-on-year increase in volumes was pleasing, but selling prices for some key products remained below the high prior-period levels."
In the first nine months, group net profit rose steeply to €1.95bn from €888m in the same period last year, but adjusted net income – which does not contain either the impact of adjustments or the discontinued operations, and thus does not include the proceeds from the divestment of the real estate business – decreased by 23% to €704m, it added.
Total sales in the first nine months fell 4% to €9.74bn as a rise in volumes were offset by lower selling prices and currency effects and the divestment of two smaller business operations.
For the whole 2013 outlook, Evonik said global economic conditions will remain challenging in the coming months.
“Although Evonik expects the slight upward trend to continue in the fourth quarter, it is not anticipating any perceptible impetus for its business, partly for seasonal reasons,” the company said.
Evonik still expects sales in 2013 to be around the same level as in the previous year at around €13bn, with adjusted EBITDA coming in at around €2.0bn.
($1 = €0.73)
Additional reporting by Tahir Ikram
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