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Performance Chemicals

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Performance Chemicals
  Q2 2012 Q2 2013 Change H1 2012 H1 2013 Change
  € million Margin
€ million Margin
% € million Margin
€ million Margin
Sales 585   561   (4.1) 1,143   1,081   (5.4)
EBITDA pre exceptionals 78 13.3 67 11.9 (14.1) 161 14.1 118 10.9 (26.7)
EBITDA 63 10.8 34 6.1 (46.0) 146 12.8 84 7.8 (42.5)
Operating result (EBIT) pre exceptionals 57 9.7 45 8.0 (21.1) 119 10.4 75 6.9 (37.0)
Operating result (EBIT) 40 6.8 6 1.1 (85.0) 102 8.9 35 3.2 (65.7)
Cash outflows for capital expenditures 1) 21   34   61.9 32   53   65.6
Depreciation and amortization 23   28   21.7 44   49   11.4
Employees as of June 30
(previous year: as of Dec. 31)
6,031   5,962   (1.1) 6,031   5,962   (1.1)
1) intangible assets and property, plant and equipment

Sales in the Performance Chemicals segment decreased by 4.1% to €561 million in the second quarter. With selling prices at the level of the prior-year quarter, this development was attributable to a 2.5% decrease in volumes and 1.9% negative effect from shifts in exchange rates. A minor portfolio effect of 0.3% was generated by the acquisition of PCTS Specialty Chemicals Pte. Ltd. in the second quarter of 2013.

Overall, volumes in this segment were down on the prior-year quarter. However, development varied across the business units. The Liquid Purification Technologies business unit increased volumes in nearly every region and was also able to raise selling prices compared to the prior-year period. The Inorganic Pigments business unit likewise achieved volume growth as well as higher selling prices. However, this positive effect was partially offset by an adverse shift in exchange rates. The segment’s other business units registered a decline in business volume. The Leather business unit suffered in particular from supply bottlenecks for a production facility as well as from stoppages at its chrome mine in South Africa. While selling prices remained close to the prior-year level in the Rhein Chemie and Rubber Chemicals business units, declines were registered in the Functional Chemicals and Leather business units. In the Material Protection Products business unit, lower selling prices were partly offset by a positive portfolio effect from the acquisition in Singapore. Exchange rate developments had a negative impact on all of the segment’s business units. Business volumes receded in nearly all regions.

EBITDA pre exceptionals amounted to €67 million, which was €11 million below the year-earlier figure of €78 million. Earnings were negatively impacted in particular by declining volumes and lower capacity utilization compared to the prior-year period. Shifts in exchange rates and the acquisition in Singapore had no material impact on earnings. The segment’s EBITDA margin decreased from 13.3% to 11.9%.

The Performance Chemicals segment posted sales of €1,081 million in the first half of 2013, down 5.4% from the same period a year ago. While selling prices remained at the prior-year level, volumes receded by 4.2%. A portfolio effect of 0.4% was more than offset by adverse exchange rate movements of 1.5%.

The segment generated EBITDA pre exceptionals of €118 million in the first six months of 2013, against €161 million in the prior-year period. The EBITDA margin decreased from 14.1% to 10.9%.

The segment’s exceptional items of €39 million for the second quarter and €40 million for the first half of 2013, of which €33 million and €34 million impacted EBITDA, respectively, related mostly to efficiency improvement and facility consolidation measures at the Belgian and South African sites of the Rubber Chemicals business unit.