ERJ staff report (RD)
Stockholm -- Rubber compounder Hexpol AB has reported sales up by 16 percent in the first quarter of 2010 (Q1) to SEK 750 million (Euro 77.4 million), compared to the same period last year. Full-year sales were SEK 2711 million, up from SEK 2608 million in 2009.
Q1 year-on-year operating profit was up to SEK 87 million, compared to SEK -52 million a year ago, a 7 May company statement said.
â€œOur first-quarter result was very strong, with a significant increase in sales volumes,â€ said Hexpol ceo, George Brunstam, adding that automotive sales had shown particular improvement. â€œHowever, negative currency effects impacted the sales increase, compared with the year-earlier quarter,â€ the Hexpol ceo added.
Hexpol's compounding business reported Q1 sales up 21 percent to SEK 581 million, compared to Q1 2009, and up 5 percent compared to the fourth quarter of 2009. Operating profit increased 90 percent to SEK 74 million, with an operating margin of 12.7 percent (Q1 2009: 8.1 percent), â€œprimarily thanks to increased sales to the automotive industry, combined with strong cost adaptions and continued flexible management of the increased volumes,â€ Hexpol said.
The compoundung unit's full-year sales were SEK 2120 million, compaed with SEK 2020 in 2009.
Geographically, Hexpol said, the volume trend in Europe was favourable, primarily from automotive customers, and increased compared with the year-earlier period, primarily in the Czech Republic and Belgium.
Although demand in other segments was stable, construction customers experienced a weak start due to the severe winter in Europe.
In NAFTA (North American Free Trade Agreement), the year-on-year volume trend was significantly higher in all segments. Volumes also increased compared with the fourth quarter, primarily to automotive customers. The operations in Mexico developed well and sales increased in the quarter compared with the fourth quarter of 2009, the statement said.
In Asia, the volume trend in the compounding area's plant in China was favourable, with deliveries significantly higher than in the year-earlier quarter. Raw material prices increased during the first quarter due to higher demand in the global market. The increase in raw material prices essentially had no impact on the business area's margins. The business area remained under price pressure due to surplus capacity, Hexpol added.
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Press release from Hexpol AB