PRESS RELEASE
Süd-Chemie Group set for another record year
– Revenue rose by 7% during the first six months of 2008 compared with the first half of 2007 and by 12% after currency adjustments
– Operating profit (EBIT) decreased slightly compared with the first half of 2007 (-2%), but rose by 5% after currency adjustments
– Managing Board reaffirms forecast for the full year of 2008 – a revenue increase of at least 7% and an EBIT rise of not less than 10% are expected
Satisfactory first six months in 2008
The Süd-Chemie Group has maintained its expansionist course and further enhanced enterprise value in 2008. It was able to match its dynamic 2007 performance in spite of negative exchange rate effects and rises in the price of commodities and energy.
Compared with the exceptionally high growth recorded during the first half of 2007, consolidated revenue rose by €36.7 million or 6.9% to reach €569.7 million during the first six months of 2008. However, revenue was negatively impacted by exchange rate fluctuations amounting to €26.2 million. Adjusted for this effect, the Group reported an 11.8% increase in revenue, of which €5.7 million was contributed by acquisitions. Both divisions operated by the specialty chemicals enterprise, Adsorbents and Catalysts, reported a positive performance. A particularly sharp rise was recorded in the demand for bleaching earth and foundry products in Europe.
Compared with the exceptionally successful first half of 2007, profit from operations (EBIT) dropped by a slight €1.2 million or 2.2% to €54.1 million. Account must however be taken of the fact that, unlike the situation during the same period in 2007, the EBIT for the first six months of 2008 was adversely affected not only by higher commodity and energy prices, but also by extraordinary effects and currency fluctuations. These included first-time consolidation of Phostech Lithium Inc., a manufacturer of battery materials based in Montreal, Canada, and unrealised losses resulting from base metal hedging which diminished the EBIT by €2.8 million and €1.8 million respectively. Furthermore, negative exchange rate fluctuations caused by the strong euro, especially against the dollar, reduced the EBIT by a total of €3.9 million. Based on constant exchange rates, the EBIT would have risen by €2.7 million or 4.9%. Compared with the first half of 2007, consolidated profit for the period fell by €1.6 million or 6.1% to €24.6 million.
Recording only marginal business expansion as a result of initially weakening growth momentum during the first half of 2008 and due to currency fluctuations, the highly-profitable Catalysts Division generated an EBIT of €35.4 million and was unable to completely match its extremely high earnings for 2007 (€35.9 million). However, in the second quarter and at the beginning of the third quarter of 2008, the division reported a marked rise in its order intake for industrial catalysts. Reaching €36.3 million, the Adsorbents Division exceeded its first-half earnings for 2007 by €1.4 million.
Optimistic outlook for the full year 2008
Based on slowing, but generally robust growth momentum in the chemical production sector, the Süd-Chemie Managing Board continues to expect consolidated revenue to increase by at least 7% in 2008 compared with 2007, reaching between €1.15 and €1.2 billion. An even faster rise of at least 10% is anticipated in profit from operations (EBIT) to between €110 and €115 million. The positive forward order level, price increases and the start-up of new manufacturing facilities underscore this optimistic outlook.
The detailed report on Süd-Chemie AG´s performance during the first six months of 2008 can be downloaded at www.sud-chemie.com.
Munich, 14 August 2008
Enquiries to:
Süd-Chemie AG
Corporate Communications and Board Affairs
Jochen Orlowski
Ph. +49 (0) 89 5110-247
Statements relating to future events
This report contains statements relating to future events based on current estimates made by the management with respect to prospective developments. Such statements are subject to uncertainties and risks which Süd-Chemie is neither able to control nor accurately assess, including for instance future market conditions and the economic environment, the behaviour of other market participants or governmental measures. Should any one of these or other uncertain or imponderable factors take effect, or should assumptions on which the statements are based prove to be incorrect, the actual results may differ significantly from those explicitly defined or implicitly contained in these statements. Süd-Chemie neither intends nor undertakes a specific obligation to update statements relating to future events in order to adjust these in line with events or developments occurring after the date of this report.
About Süd-Chemie
Süd-Chemie AG (www.sud-chemie.com) is a publicly quoted (Security Identification Number ISIN: DE0007292005; WKN: 729200) specialty chemicals company headquartered in Munich, Germany and operating on a worldwide scale. Key markets served by its Adsorbents Division include the consumer-goods, packaging and foundry industries, as well as the paper and plastics industries and water treatment. Products manufactured by the Catalysts Division offer solutions for the chemical, petrochemical and refinery industries, for energy storage and hydrogen production, as well as off-gas purification. The common denominator of all its products and innovations is the efficient and sparing use of natural resources to enhance the quality of life for humans and the environment. Süd-Chemie generated sales of €1.075 billion in 2007, approx. 80% of these outside Germany. In mid 2008, the group employed more than 6,100 people at its 80 sales and production sites worldwide.