Clariant repositions portfolio, reports full-quarter profitability

Specialty chemicals firm Clariant has announced a full-year sales 2012 from continuing operations of CHF 6.038 billion compared to CHF 5.571 billion in the previous-year period. This corresponds to an increase of 8% in local currencies and in Swiss francs and was driven by the acquisition of Süd-Chemie, while organic growth was flat with 2% higher prices offsetting lower volumes.

Except in Europe, where sales declined 2%, sales in all regions grew double-digit in 2012. During the year, the company’s performance in the Asia/Pacific region has remained strong. While Europe has weakened in the second-half, the impact on Clariant was offset by growth in the other regions. Clariant has roughly two thirds of sales generated outside of the Europe.

The company’s Catalysis & Energy and Oil & Mining Services Business Units (BU) are both growing double-digit in a year-on-year comparison. Industrial & Consumer Specialties and Functional Materials and Masterbatches were able to endure the slack, while the Pigments and Additives BUs were impacted by the severe downturn in some end-markets – mainly in Coatings, Printing and Electronics – and primarily in Europe.

Also in 2012, Clariant divulged that it would be looking for strategic options for the four BUs - Textile Chemicals, Paper Specialties, Emulsions Detergents & Intermediates and Leather Services.

Late last year, the company had agreed to divest its Textile Chemicals, Paper Specialties and Emulsions businesses to SK Capital, a US-based investment firm. The transaction is expected to close by the end of Q2/2013. With the Leather Services and Detergents & Intermediates also being evaluated for strategic options, all four BUs are reported as “discontinued operations”, starting with 2012 full-year results.

The acquisition of Süd-Chemie, full-year 2012 sales including discontinued operations amounted to CHF 7.782 billion, a 6% increase from the CHF 7.370 billion recorded in 2011. In local currencies sales were also 6% higher. EBITDA before exceptional items fell 4% to CHF 934 million (margin 12.0%) from CHF 975 million (margin 13.2%) in full-year 2011. Fourth quarter 2012 sales including discontinued operations rose 2% in local currency and 1% in Swiss francs to CHF 1.936 billion from 1.918 billion in the previous-year period. The EBITDA before exceptionals was 9% higher at CHF 264 million (margin 13.6%) compared to CHF 241 million (margin 12.6%) in the fourth quarter 2011.

Clariant expects a persisting soft macroeconomic environment characterised by high volatility. Whilst solid growth in the emerging markets is most likely, no significant growth impulses are expected from the European and the North American economies.

Assessing these developments, in a nutshell, CEO Hariolf Kottmann said, “Clariant achieved solid results in a demanding year, with the majority of businesses performing well. In most regions the company continued on a robust growth path. In Europe, the economic weakness affected some of the more cyclical businesses. Concerning the repositioning of Clariant, the company has made good progress. Five businesses have been reclassified as discontinued operations and an agreement to divest three of those businesses has already been signed. The focus in 2013 will now be on growing the remaining seven core businesses. Combined with continuous cost efficiency, the reshaped Clariant is well positioned to achieve its 2015 targets.”


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