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MOSCOW (MRC) -- Clariant says its
third-quarter sales declined 14% year on year (YOY) to 893.0 million Swiss
francs (USD979.5 million) due to lower volumes and negative currency effects
that also squeezed profitability, with EBITDA for the period lower by 16% YOY,
to SFr127 million, according to Chemweek.
The company’s EBITDA margin recorded a slight YOY decrease of 0.3
percentage points, to 14.2%. Net profits have not been
disclosed.
Clariant’s care chemicals and catalysis businesses recorded
higher EBITDA margins due to more favorable product mixes, cost mitigation, and
efficiency improvement, the company says. Natural resources posted a lower
EBITDA margin, mainly due to lower volumes in industries affected the most by
COVID-19 such as automotive, textiles, and oil, the company
says.
Clariant expects third-quarter sales to be the lowest of the first
three quarters of 2020. Its natural resources business was affected the most,
with all three segments of the business impacted negatively by oversupply in oil
markets and the pandemic. Sales in care chemicals and catalysis softened only
slightly, it says.
Natural resources' EBITDA fell 38% YOY, to SFr44
million on 22% YOY lower sales, to SFr356 million, due to lower volumes
resulting from weaker demand, especially in the oil and mining services segment.
Care chemical sales decreased 9% YOY, to SFr330 million, but EBITDA increased
16% YOY, to SFr72 million, due to performance measures and a favorable product
mix, the company says. Sales of Clariant's catalysis business were 9% lower YOY,
to SFr207 million, and EBITDA decreased 5%, to SFr42 million.
“Over the first nine months of 2020, we successfully upheld the
profitability of our continuing operations despite an exceedingly challenging
environment. Although the COVID-19 pandemic had a significant negative impact on
several of Clariant’s key end markets in the third quarter, the performance
resilience clearly validates the success of our strategic focus on the three
core specialty business areas,” says Hariolf Kottmann, executive chairman ad
interim at Clariant.
Clariant anticipates that the COVID-19 pandemic will
have a continued, but slightly less negative impact on sales and profits in the
fourth quarter of 2020 compared with the third quarter. The company says it will
continue with its performance programs to achieve above-market growth, higher
profitability, and stronger cash generation in the midterm.
Clariant says
it will also continue its transformation program, which has reshaped the
company's portfolio through the divestment of healthcare packaging in October
2019 and masterbatches in July 2020, and that it is “progressing with the
planned divestment of pigments while preparing the rightsizing of the
organization.”
As MRC reported before,
earlier this month, Clariant (Muttenz, Switzerland) announced the
construction of a new state-of-the-art catalyst production site in China. This
project represents a significant investment which further strengthens Clariant’s
position in China and enhances its ability to support its customers in the
country’s thriving petrochemicals industry.
The new facility will be
primarily responsible for producing the Catofin catalyst for propane
dehydrogenation, which is used in the production of olefins such as propylene.
Thanks to its excellent reliability and productivity, Catofin delivers superior
annual production output compared to alternative technologies, resulting in
increased overall profitability for propylene producers, says the company.
Construction at the Dushan Port Economic Development Zone in Jiaxing, Zhejiang
Province was scheduled to commence in Q3 2020, and Clariant expects to be at
full production capacity by 2022.
Propylene is the main feedstocks for
the production of polypropylene (PP).
According to MRC's ScanPlast report,
PP shipments to the Russian market reached 767,2900 tonnes in the eight months
of 2020 (calculated using the formula - production minus exports plus imports -
and not counting producers' inventories as of 1 January, 2020). Supply increased
exclusively of PP random copolymer.
Clariant AG is a Swiss chemical
company and a world leader in the production of specialty chemicals for the
textile, printing, mining and metallurgical industries. It is engaged in
processing crude oil products in pigments, plastics and paints. |
