Challenges ahead for Cognis
months of the year on a level with last year's figure, rising by a
mere 1 per cent to €2,408 million. A better-than-average
performance came from the nutrition and health unit, with a 7 per
cent rise on last year's sales, thanks to demand for sterols in
Europe, vitamin E in the USA and carotenoids in Australia.
Speciality chemicals group Cognis reported sales for the first nine months of 2002 on a level with last year's figure, rising by a mere 1 per cent to €2,408 million. The EBITDA increased marginally more, to €321 million, a rise of 6 per cent over the comparable period in 2001.
"We are very satisfied with the EBITDA recurring," said Joachim Sohngen, chief financial officer at Cognis. "However, in the fourth quarter currency effects, expenditures for advertising as well as investments in the company structure will affect the group's operating profit. But we are optimistic that we will still be able to slightly exceed last year's level," he continued.
He attributed the stagnation in sales to the Euro/US dollar exchange rate, which started to impact the business in the third quarter, and added that the difficult business climate in Asia and Latin America has also taken its toll. Noting that sales in the chemicals industry usually drop in the summer, the CFO said the company's development "has continued to be good, which we see as an endorsement of our business strategy."
The Nutrition & Health business unit saw the greatest growth of all five business units, clocking up sales of €213 million, a 7 per cent rise on last year's figure. The company pinpointed demand for sterols in Europe, vitamin E in the USA and carotenoids in Australia as major contributors to the boost in sales.
The Oleochemicals business unit recorded sales of €802 million, a drop by 3 per cent over last year. Cognis said the drop was caused mainly by a decline in the general price level, which could not even be compensated by lower raw-material prices. Product sales in Oilfield Chemicals were adversely influenced by two hurricanes in the Gulf of Mexico. Sales of Care Chemicals climbed 2 per cent during the period, to €427 million however, with good business in Turkey, Thailand and Taiwan, said the company. Lower raw-material prices were offset by adverse currency influences in Latin America. Sales in the Functional Products unit dropped slightly by 1 per cent over the same period last year and Process Chemicals sales also dropped slightly, due to declining demand in the textiles industry worldwide (except in the USA) and a decrease in plastics additives in the USA and Asia.
At €53 million, sales in Other Activities were 29 per cent above the comparable period in 2001, due, in particular, to a high demand for aroma chemicals, according to the company.