Orion reports strong earnings

Luxembourg – Orion Engineered Carbons has posted a 10% year-on-year rise in adjusted earnings (EBITDA) at €222.7 million despite a 7% drop in revenue at €1.03 billion for the full year 2016.

Profit for the fiscal year rose to €44.6 million from €42.8 million the previous year, said the carbon black company in a 23 Feb statement.

The company registered a strong fourth quarter, with a 9.4% rise in adjusted earnings to €55.6 million. Rubber black adjusted EBITDA increased 12.9% to €25.3 million during the quarter.

Total volumes increased by 17.1kt, or 6.5%, to 280.6kt in the fourth quarter compared to 263.5 kt in the same quarter in 2015. The increase reflected a 10.0% gain in speciality carbon black volumes and a 5.6% gain in rubber carbon black volumes.

Rubber black revenue rose 6.7% to €180.2 million in the fourth quarter with adjusted earnings up 12.9% at €25.3 million.

“We achieved solid volume growth in both our specialty and rubber businesses in the quarter, but speciality growth was especially strong, rising 10% versus the prior year,” said Jack Clem, chief executive officer.

The growth in specialty volume, he added, “more than offset” some margin pressure as a result of a rise in the price of feedstock in the quarter.

The rubber segment continued to benefit from the feedstock surcharges the company implemented earlier in the year and a strong fourth quarter contribution from the recently acquired business in Qingdao, China (OECQ), Clem added.

Restructuring expenses for the period included personnel-related costs of €6.1 million following the closure of production plant in Ambès, France. Additionally, demolishing the plant, site remediation and other expenses for the cessation of the facility stood at €11.5 million.