MONHEIM, Germany - In the second quarter of 2010, global specialty chemicals supplier Cognis continued its positive performance from the first quarter, achieving the best half-year results in the company’s history. Sales rose by 16.3 percent to EUR 1,514 million due to a steady improvement in demand. Sales volumes increased by 12.6 percent, reaching the level of the first half of 2008. All regions contributed to this positive development, with Asia-Pacific showing the most dynamic growth rates.
Cognis achieved an operating result (adjusted EBITDA) of EUR 281 million in the first half of 2010. This represents an increase of EUR 113 million (67.5 percent) on the previous year. Return on sales (adjusted EBITDA as a percentage of sales) reached 18.5 percent. These figures were largely due to higher sales volumes, a further shift in the product portfolio towards high-value specialties, and better capacity utilization. The company’s ability to keep operating costs stable also played an important role, as the cost-management activities initiated in 2008 and 2009 continued to pay off. In addition, recent foreign exchange movements had a positive effect on the operating result.
Earnings before interest and taxes (EBIT) increased by EUR 148 million to EUR 226 million, resulting in a return on sales of 14.9 percent. Net profit for the period also improved by EUR 129 million due to this strong operating performance, and stood at EUR 109 million compared to a net loss of EUR 20 million in the first six months of 2009.
The company generated a strong operating cash flow of EUR 119 million, although investment in working capital amounted to EUR 129 million, due to the substantially higher level of commercial activity in the first six months of 2010. Overall, Cognis’ cash position improved to EUR 334 million in the first half of 2010.
Looking forward to the second half of 2010, Cognis CEO Antonio Trius commented, “Given the excellent performance in the first half of 2010, followed by a very strong start into the third quarter, we expect to achieve a record full-year result. However, the economic situation remains highly uncertain, and trading conditions are difficult to predict. We expect that markets will remain volatile, and that the recovery will continue at a more moderate pace in the second half of 2010.”