Brenntag 'delivers strong results' in 2013

ERJ staff report (TP)

Mülheim an der Ruhr, Germany − Brenntag, the chemical distribution company, said it delivered “strong results” in 2013 in “challenging” markets.

For the 2013 financial year, sales increased to €9.7bn, up 3.3 percent on the previous year on a constant currency basis (0.8 percent as reported). In the reporting period, gross profit* amounted to €1.94bn, an increase of 3.7 percent year-on-year on a constant currency basis (1.0 percent as reported).

On a constant currency basis, operating EBITDA** was up 1.6 percent on the previous year (-1.2 percent as reported), totalling €698.3m. Adjusted for non-recurring increases in provisions in the Europe segment the result increased by 2.4 percent year-on-year on a constant currency basis. Accordingly, the adjusted operating EBITDA amounts to €715.1m and meets the guidance range of €710m to €725m.

Steven Holland, CEO of Brenntag, said: "As expected, 2013 proved to be a dynamic business environment with a number of challenges in both developed and emerging markets throughout the world.

“We were once again able to demonstrate a high degree of resilience in such markets through our highly diversified business model and report strong results for the year.”

Operating gross profit* increased by 1.3 percent year-on-year on a constant currency basis (0.2 percent as reported) to €930m. Operating EBITDA** stood at €297.4m, corresponding to a slight reduction of 1.5 percent on a constant currency basis (2.8 percent as reported). After adjustment for a non-recurring increase in provisions, adjusted operating EBITDA rose by 0.4 percent on a constant currency basis.

According to a forecast by the International Monetary Fund, the global economy is likely to grow more strongly in 2014 than in 2013. Based on the significant groundwork Brenntag has performed, the company expects to benefit from this forecasted improvement in 2014.

"We have worked diligently to position the group positively to capture accelerated organic growth as global economies emerge from weak underlying demand. Therefore we are optimistic about the future growth and development for the company in both 2014 and the years ahead," said Holland.

* While Brenntag reports operating gross profit on segment level, the company reports gross profit on Group level. Operating gross profit is defined as sales less costs of material for goods purchased and supplies, services purchased, packaging materials, supplier rebates and increase/decrease in finished goods. Gross profit is defined as operating gross profit less production/mixing and blending costs.

** Brenntag’s segments are primarily controlled on the basis of operating EBITDA, which is the operating profit/loss as recorded in the consolidated income statement plus amortisation of intangible assets as well as depreciation of property, plant and equipment and investment property, adjusted for the following items:

Transaction costs: Costs connected with restructuring under company law and refinancing. They are eliminated for purposes of management reporting to permit proper presentation of the operating performance and comparability on segment level.

Holding charges: Certain costs charged between holding companies and operating companies. On Group level they net to zero.

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Press release from Brenntag