Weaker European currencies help boost Clariant 2Q results

By Simon Pitman

- Last updated on GMT

Related tags United states dollar Euro

Switzerland-based specialty chemicals players Clariant has announced a big jump in 2Q sales, boosted by the strength of the US dollar against European currencies and weaker 2009 comparisons.

Sales for the period rose by 18 per cent, from CHF1.609bn (€1.171bn) to CHF 1.894bn, which represented an increase of 20 per cent in local currencies.

The company said that the growth was reflected by an increase in sales volumes in all business segments and geographic regions, but also acknowledged that comparisons were difficult given the much weaker Q2 in 2009.

Struggle to regain pre-recession levels

Despite the big increase in sales, the company is struggling to return to the sort of results it was reporting before the recession hit and with a weaker outlook for the second half of 2010, that goal is looking more challenging.

However, demand returned in the European market during the period, a factor that was further boosted by the weaker Euro to US dollar exchange rate, which ultimately helped international results.

The company said that there was also continued growth in Asia, Latin America and North America, which helped to further boost sales figures.

Outlook weaker

Looking ahead to the full year 2010, the company is forecasting that further weakness will be seen, especially as the seasonal nature of its business does not favour the last two quarters, as well as the fact that raw material prices and other costs are expected to rise further.

The company says that it is expecting sales growth in 2010 to reach the high single digit figures, while the EBIT margin is expected to be above 8 per cent.

The company is a leading supplier of specialty ingredient for the hair care and skin care markets and also provides ingredients for a range of packaging materials.

Masterbatches for compostable bioplastics

Last month the company announced the launch of a range of colour and additive masterbatches for compostable bioplastics.

The new masterbatches are an ‘in-between’ range that combine the benefits of the company’s conventional and all-natural ranges to offer greater flexibility to manufacturers, according to Clariant.

The new products can be used in a variety of application areas including cosmetics and personal care, and will be marketed under the Renol-compostable and the Cesa-compostable additive brand names. Over 80 pigments are expected to be available.