Latin America helps buoy Clariant’s financial performance

05-Nov-2019 - Last updated on 04-Nov-2019 at 18:34 GMT

Related tags Clariant European union Ingredients Latin america

Specialty chemicals players Clariant has overcome challenging conditions in North America and China, as well as the Care Chemicals division, thanks to strong results in its new markets, particularly in Latin America.

The company reported that for its most recent quarter, sales from continuing operations were up 2% in local currency terms to CHF 1.04 billion, but the figure represented a 1% decrease in Swiss Francs year-on-year because of currency headwinds.

The figures for the first nine months of the financial year show a better picture, with sales up 3% in local currency terms and the result in Swiss France being stable.

Latin America sales up by double digits

Over that nine month period sales in the Latin America, Middle East & Latin America really helped buoy the performance, with both regions growing by 11%, which help deflect poorer performances elsewhere.

In China sales were down by 9% for period, which held back growth in the Asia Pacific region to 4%, while in Europe sales 2% and in North America sales saw a contraction of 4%.

On a division basis, the company’s Care Chemicals division, which serves the cosmetics and personal care arena, saw sales for the nine month period fall by 4% to CHF 1.21 billion, while in local currency or organic terms this represented a fall of 1%.

Silicones alternative helps boost sales

The company said that the introduction of its silicone alternative Plantasens Flash 80 had met with success, because of its lightweight properties and the fact that it can be used in such a wide variety of formulations, including hair conditioners, deodorants, facial cleansers and other skin care products.

Sales in the Natural Resources division for the first nine months of the year were level at CHF 1.4b billion, which represented an increase of 4% in local currency.

The results were also counteracted by a much stronger performance in the Catalysis division during the same period, where sales increased 9% to CHF 659 million, while this represented an increase of 10% in local currencies.

Profits take a hit from EC competition probe

EBITDA for the nine month period was significantly impacted by a one-off provision of a CHF 231 million payment in relation to a competition law investigation by the European Commission into ethylene purchasing.

This meant that the EBITA for the full nine months decreased significantly, from CHF 483 million in the previous year, to CHF 253 million in the previous year.

“Our nine months results reflect the resilience and quality of our continuing businesses, in particular in light of the worsening economic environment in the third quarter,” said Hariolf Kottmann, Executive Chairman of Clariant.

“Looking forward, we will continually improve our performance through further operational improvement initiatives and the systematic implementation of our portfolio strategy to focus on higher value specialty businesses.”