Lanxess: Q2 net income down 95 percent; 2013 will 'remain challenging'

ERJ staff report (BC)

Cologne, Germany – Lanxess expects the business year 2013 to “remain challenging” after the German speciality chemicals company posted a decline in second quarter sales and earnings.

The salient points of the company’s report are:

• Q2 sales €2.1 billion, down 12 percent

• Q2 EBITDA pre-exceptionals €198 million, down 45 percent

• Q2 net income €9 million, down 95 percent

• Outlook for 2013: €700-800m EBITDA pre-exceptionals

• 2014 EBITDA pre target of €1.4 billion no longer realistic

• Strategy update underway, results in September

Lanxess commented that by contrast to its expectations in May, the company does not foresee an improvement in business conditions in the second half of the year, with customers continuing to destock their inventories, noticeably in Asia, and overall consumer sentiment remaining weak.

The group’s board of management chairman Axel C Heitmann said: “The first half of 2013 does not meet our own high standards. Trading conditions for our businesses remain tough and the fragile sentiment in Europe is now evident in other markets that are important for us, such as China and Brazil.”

The company has already cut its 2013 capital expenditure budget to €600m.

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Press release from Lanxess