04 March 2014 11:44 [Source: ICIS news]
PARIS (ICIS)--Arkema expects improved growth levels this year after posting a decline in sales and profits in 2013, the France-based chemical company’s CEO said on Tuesday.
“We are confident that we will recover growth in 2014,” said Arkema CEO Thierry Le Henaff, speaking in Paris.
The company is predicting that macroeconomic conditions for the year will remain broadly in line with those of 2013, but remains bullish on economic prospects for its key markets in North America and Asia, where it is concentrating its expansion efforts at present.
The company derived 41% of its sales last year from Europe, with France and Germany comprising 18% of that total, 34% from North America with a focus on the US, and 20% from Asia, of which 9% was derived from China.
5% of sales were generated in the rest of the world, although the company announced its first Middle Eastern plant, an organic peroxides unit in Al Jubail, Saudi Arabia, in 2013.
“For 2014 looking at macro assumptions, we believe that [conditions] will remain in line with 2013,” Henaff said. “We are positive on the states, [due to] solid growth in auto sector and construction sector, which started picking up at the end of 2012 and should recover to previous levels.
“In Europe, we are attentive to what is happening. The [economic] situation is levelling off, there will be a recovery, but the question is when.
"As with the states we’ve always been positive on [China, southeast Asia]. This is where our major investments go. Even though China is more mixed than it used to be... this is where the growth areas are,” he added.
Arkema posted a 16.6% year-on-year fall in net income for 2013 to €368m on the back of lower sales and lower earnings before interest, taxes, depreciation and amortisation (EBITDA), but noted a “major improvement” in the fourth quarter of the year, when it posted a 4.5% increase in adjusted net income to €46m on the back of improvements in high performance materials earnings.
Arkema said the company’s current growth strategy is based on innovation, an increased presence in emerging markets, and bolt-on acquisitions, with several investments to bolster its high performance materials division expected this year.
Henaff declined to comment on acquisition targets, but said that high performance plastics - particularly lightweight materials - were of interest, as well as high-value polymers.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections