MOSCOW (MRC) -- LANXESS posted lower earnings in the first quarter of 2013 as expected due to a weak market environment, particularly in the tire and automotive industries, said the producer.
First-quarter sales were down by 12% year-on-year to EUR 2.1 billion, mainly due to lower volumes and fallen selling prices. EBITDA pre exceptionals moved back by 53% against the prior-year period to EUR 174 million and was thus within the target corridor of between EUR 160 million and EUR 180 million communicated in March. The operating result was diminished by scheduled one-time effects of about EUR 30 million for the start-up of the new butyl rubber plant in Singapore and the conversion to Keltan ACE technology at the EPDM rubber plant in Geleen, Netherlands.
At the start of the year, LANXESS already initiated temporary facility shutdowns in the Performance Polymers segment in line with its proven policy of flexible asset and cost management. Now additional measures are planned in the Performance Chemicals segment.
LANXESS is also reducing its capital expenditure budget for 2013 to EUR 600 million from the previously planned level of EUR 650 million to EUR 700 million.
In the polymers segment, sales moved back by about 18% to EUR 1.1 billion. Here, a drop in selling prices as a result of lower raw material prices led to a negative price effect. In addition, volumes were down on account of lower demand from the automotive and tire industries. EBITDA pre exceptionals fell by 56% to EUR 112 million. Earnings were diminished due to the above-mentioned one-time effects of about EUR 30 million.
As MRC wrote earlier, LANXESS has broken ground for its new neodymium-based performance butadiene rubber (Nd-PBR) plant in Singapore. The German specialty chemicals company is investing roughly EUR200 million in a 140,000 metric tons per annum facility on Jurong Island.
LANXESS is a leading specialty chemicals company with sales of EUR 8.8 billion in 2011 and currently around 16,900 employees in 31 countries. The company is currently represented at 48 production sites worldwide. The core business of LANXESS is the development, manufacturing and marketing of plastics, rubber, intermediates and specialty chemicals.