Altana's nine-month earnings decline 53% year-over-year to €47.5M as sequential quarterly improvements failed to compensate for bad Q1 results; sales slide 18% to €872.2M
November 6, 2009
* Considerable momentum in Q3
* Accumulated still clearly below prior-year figures
* Sales down 18 percent, EBITDA down 35 percent
* EBITDA margin 16 percent
The specialty chemicals Group ALTANA (Pink Sheets:AAAGY) (FWB:ALT) (GER:ALT) records in the third quarter of 2009 another clear recovery of the business. The sequential increase in sales and earnings from quarter to quarter, however, was not strong enough to compensate for the bad results particularly from the first quarter of 2009. In total, ALTANA posted sales of €872.2 million for the period January to September 2009, compared to €1,067.5 million in the same period a year ago. This corresponds to a decline of 18%. Earnings before interest, taxes, depreciation and amortization (EBITDA) decreased by 35%, from €213.1 million to €139.4 million. Even though, at 16.0%, the present EBITDA margin is lower than the prior-year value (20%), it is already clearly higher than the one for the first six months of 2009 (12.6%). Earnings before taxes (EBT) amounted to €70.4 million, following €152.1 million in 2008.
Development of the divisions
Sales in the BYK Additives & Instruments division totaled €311.5 million, a decrease of 14% on the prior-year figure of €361.5 million. ECKART Effect Pigments posted sales €207.2 million, corresponding to a decline of 26% on the same period last year (€281.6 million). Sales in the ELANTAS Electrical Insulation division were down by 23% from €258.8 million to €200.0 million. The ACTEGA Coatings & Sealants division proved the most resilient to the economic crisis; here, sales in the first nine months of the business year decreased only 7% from €165.6 million to €153.5 million.
Consistent cost management, further investments for the future
On account of reduced material and personnel expenses, the program to cut costs, which had already been initiated in the late summer of 2008, will lead to savings of about €55 million by the end of the year, of which around €47 million have already been achieved. At the same time, ALTANA has continued to invest in innovation and customer service, in order to maintain and expand its leading role in the markets even and especially in this crisis.
“The worldwide economic crisis has confronted ALTANA with great challenges, which we have successfully met thanks to the joint efforts and commitment of all our employees. Our company has proved that we are successful not only in good times, but also navigated solidly through turbulent waters,“ stated Dr. Matthias L. Wolfgruber, CEO of ALTANA AG, but warned against raising expectations too high: “Our business model has proved to be robust in the crisis. However, it will take time, also at ALTANA, to return to the sales and earnings levels of 2007 and 2008.”
Although the demand situation has gradually improved in the past two quarters, the uncertainty concerning the further development of the markets which are relevant for ALTANA is still very high. Therefore, the Group-wide ongoing programs to save costs and enhance efficiency will be continued. On the basis of our business performance in the past nine months and taking into account the present order situation, we still expect a significantly declining sales and earnings performance for the business year 2009 compared to 2008. Due to the high uncertainty of the general economic environment, it is still not possible at present to provide any concrete sales and earnings forecast.
A telephone press conference will take place today, November 5, 2009, at 10:00 a.m. local time (CET).
IndustryIntel Editor's Note: In an omitted table, the company reported nine-month sales of €872.2 million, net income of €47.5 million and earnings per share of €0.35. For the same period a year ago, the company reported sales of €1.07 billion, net income of €101.8 million and earnings per share of €0.75.
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