Latin America, Asia Synthetic Rubber Demand Behind Lanxess Q2 Earnings Growth
Upon releasing chemical manufacturer Lanxess AG’s financial results for the second quarter of 2010, the company’s Board of Management chairman Axel Heitmann commented on the ten best-selling Lanxess products: “This list features eight rubber products from the Butyl Rubber and Performance Butadiene Rubbers business units for the manufacture of tyres,” he stated.
This strong tyre industry demand aided the company’s Performance Polymers segment in achieving sales of 958 million euros, a year-on-year increase of more than 71 per cent, with volumes growing 28 per cent. Heitmann reported that all four Performance Polymers business units (Butyl Rubber, Performance Butadiene Rubbers, Semi-Crystalline Products and Technical Rubber Products) registered “strong demand”, with capacity utilisation continuing to increase and exceeding levels in the first three months of this year. “In fact, some plants of the three rubber business units have recently seen utilisation rates above the group average of over 85 per cent. For example, the Butyl Rubber business unit was again operating at full capacity,” Heitmann added. EBITDA pre exceptionals in the Performance Polymers segment rose by 119 million euros to 171 million euros, with an EBITDA margin of 17.8 per cent, compared with 9.3 per cent a year ago.
In total, Lanxess achieved sales of 1.83 billion euros in the second quarter of 2010, representing a growth of 48 per cent year-on-year. The company has more than doubled EBITDA pre exceptionals year-on-year to 269 million euros during the three-month period, and Lanxess notes that earnings were primarily driven by ongoing strong demand for synthetic rubber in Asia and notably Latin America. EBITDA margin pre exceptionals – another key performance indicator – rose to 14.7 per cent from 9.0 per cent a year ago. Net profit for the quarter was 131 million euros, as opposed to 17 million euros a year earlier.