Cognis Reports Strong First-Quarter Results
May 29, 2008
MONHEIM, Germany - In the first three months of 2008, global specialty chemicals supplier Cognis increased its net external sales to EUR 953 million, up 7.1 percent compared with the same period in 2007. On an organic basis, sales grew by 11.3 percent. All three strategic business units – Cognis Care Chemicals, Nutrition & Health and Functional Products – increased sales by focusing on the innovation-driven growth markets of wellness and sustainability.
The operating result (Adjusted EBITDA) was at EUR 109 million (down 1.9 percent). This is primarily due to further increases in raw material and energy costs and unfavorable exchange rates. Cognis improved its position in key markets and partially passed on raw material cost increases. On an organic basis, the operating result was up 0.4 percent (excluding foreign currency effects and the divestment of Functional Products’ G-Cure business). Return on sales (Adjusted EBITDA as a percentage of sales) stood at 11.4 percent. Due to lower restructuring costs, earnings before interest and taxes (EBIT) increased by 6.1 percent to EUR 68 million. For the same reason, net profit increased to EUR 10 million, representing an increase of about 12 percent despite slightly higher income taxes.
“Considering the challenging situation we have been facing, we achieved our expectations. We performed well in the first quarter of 2008, with increased sales across all our core business areas,” commented Cognis CEO Antonio Trius.
“As 2008 continues, we expect the market environment to stay challenging,” said Trius. “But we are well prepared. We are confident that further price increases and stringent cost management will support us to remain on track and to achieve our targets.”
Care Chemicals saw its sales rise by 9.6 percent to EUR 398 million (organic sales growth of 12.3 percent). Nutrition & Health recorded sales of EUR 91 million, a 5.8 percent rise (organic sales growth of 7.8 percent). Functional Products achieved total sales of EUR 229 million, an increase of 2.6 percent (organic sales growth of 9.9 percent).