Germany’s Brenntag Q2 profit up 5% on North America, EMEA

09 August 2017 09:31 Source:ICIS News

Brenntag warehouse. Source - Brenntag

LONDON (ICIS)--Brenntag’s second-quarter post-tax profit moved up 4.6% to €106.8m on the back of a notable increase in profits from its North American operations and good performance in Europe, the Middle East and Africa (EMEA), the Germany-headquartered chemical distributor said on Wednesday.

Sales revenues climbed 12.7% to €3.0bn, from €2.66bn in the second quarter of last year.

Operating earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 1.9% to €219.8m, while operating gross profit gained 6.3% year on year to €656.5m.

Brenntag’s CEO, Steve Holland, said the company had achieved in North America a clear increase in operating gross profit for the second consecutive quarter.

“Here, we are currently experiencing a very dynamic environment and strong demand for our products and services. In the EMEA region, operating gross profit showed a solid increase commensurate with the economic environment,” he said.

“Growth in the Asia Pacific region is also positive, but was held in check by weak demand in some countries and product lines. Here, the acquisitions in particular made a positive contribution.”

Conditions in the Latin America region remained difficult, as expected, added Holland, “but we were able to generate operating gross profit broadly on a par” with the prior-year figure.

Brenntag said it was now able to offer a more precise outlook for operating EBITDA for 2017, a figure in the €820m-850m range.

“Our estimate implies an improvement in growth in the second half of 2017 and is based on the positive impetus we are currently seeing,” said the CEO.

Brenntag signed during the April-June quarter an agreement to acquire the business of Wellstar Group, which distributes specialty chemicals in China, a market Brenntag entered in 2011.

The company will initially gain a 51% interest in the group, with the remainder scheduled to be acquired in 2021.

Pictured above: a Brenntag warehouse in Finland
Source: Brenntag

By Will Conroy