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Home  > Markets & companies  > Raw materials market  > Strong start to 2015 - outlook raised

Sunday, 22 September 2019
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Markets & companies, Raw materials market

Strong start to 2015 - outlook raised

Thursday, 7 May 2015

Specialty chemicals company Evonik Industries started 2015 with a strong performance, generating one of its best quarterly results since 2009.

Klaus Engel, Chairman of the Executive Board of Evonik Industries<strong> </strong>AG. Source: Evonik Industries<strong> </strong>AG

Klaus Engel, Chairman of the Executive Board of Evonik Industries AG. Source: Evonik Industries AG

"The positive trend observed in the second half of 2014 has continued," said Klaus Engel, Chairman of the Executive Board of Evonik Industries AG, when the company published its key financial data for the first quarter. "Looking at our clear earnings increase, it is pleasing to see that three quarters of our 22 business lines were able to improve their earnings year-on-year," he continued. Looking forward, he is optimistic about 2015 as a whole: "We should exceed the targets previously forecast for 2015."

Prices in the Performance Materials segment slipped

The Nutrition & Care and Resource Efficiency segments posted dynamic growth and raised volumes considerably year-on-year thanks to buoyant global demand. Capacity utilization at the production facilities that came on stream last year is therefore already good. Selling prices in the Nutrition & Care segment rose considerably, whereas prices in the Performance Materials segment slipped further, mainly because of the drop in the oil price. The price effects in the segments balanced each other out, so the Group's selling prices were stable overall. The Group's adjusted EBITDA improved considerably compared with both the previous quarters and the prior-year period. This was also driven principally by the Nutrition & Care and Resource Efficiency segments. In addition, currency effects had a positive influence on sales and earnings growth.

Outlook for 2015 raised

In view of the positive business trend in the first quarter, Evonik is raising its outlook for fiscal 2015. The company still anticipates that sales will rise slightly (2014: EUR 12.9 billion). The forecast for adjusted EBITDA is now at least EUR 2.2 billion (2014: EUR 1,882 million), whereas at the start of the year a slight rise was assumed. Compared with the outlook given at the start of the year, the expected sales and earnings development now includes positive exchange rate effects (based on assumed euro/US dollar exchange rate of US$ 1.13, previously: around US$ 1.30).

Performance Materials segment

In the Performance Materials segment, sales were EUR 851 million, 15 percent lower than in the prior-year period. Adjusted EBITDA was EUR 72 million. The adjusted EBITDA margin increased slightly to 8.5 percent. The main reasons for this segment's development were lower volumes and, in particular, a drop in selling prices due to the lower oil price.

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