Wacker notes improved silicones demand on restocking

Munich, Germany - Wacker Chemie AG has reported tentative signs of recovery, after posting declines in sales and earnings within its silicones division for the quarter ended 31 March.

Earnings (EBITDA) fell 15% year-on-year to €81 million, on a 7% decrease in silicones sales to €710 million, according to Wacker's latest quarterly statement.

Quarter-on-quarter, however, both sales and earnings were up, as the division more than doubled earnings and increased revenue by 17%.

In its 25 April results announcement, the German group linked the weaker year-on-year performance mainly to lower prices.

Sequential growth was attributed to higher sales, higher plant-utilisation rates, lower raw-material prices, and positive investment income.

Overall, Wacker said it noticed both year-on-year and quarter-on-quarter improvement in demand for silicone specialities, mainly on customer restocking.

However, prices for standard grade silicones remain at a low level, the German group noted.

“As expected, the ongoing economic downturn and lower selling prices are reflected in our figures,” said group president & CEO Christian Hartel.

But in terms of demand, Hartel said, "customers have started to replenish their inventories from the recently very low levels."

“The demand for silicones in particular trended upward in the first quarter,” said Hartel, adding “but this cannot yet be seen as a distinct sign of a lasting turnaround.”