Clariant commences 2017 with strong sales growth and a significantly improved absolute EBITDA

First quarter sales grew by 9% in local currency to CHF1.602bn
EBITDA before exceptional items significantly rose by 10% in local currency to CHF250M
EBITDA margin before exceptional items increased to 15.6%
2017 outlook unchanged: continued local currency growth, progression in profitability and operating cash flow generation

"Clariant achieved a very good start into the year with good volume growth and higher profitability”, said CEO Hariolf Kottmann. "Our focus on local currency growth and profitability improvement is clearly reflected in these encouraging results. We are on a solid path towards achieving our sales expansion targets, a continued progression in absolute EBITDA and EBITDA margin before exceptional items as well as operating cash flow generation, in spite of what continues to be a challenging market environment in specific business areas.”

First quarter 2017 – Significantly higher sales and double-digit improvement in absolute EBITDA
Clariant, a world leader in speciality chemicals, has announced Q1, 2017 sales of CHF1.602bn compared to CHF1.478bn yr-on-yr. This corresponds to an increase of 9% in local currency and 8% in Swiss francs. The sales growth was driven by higher volumes across all Business Areas and increased by 3% due to acquisitions.
In Q1, local currency sales growth was strong in Europe at 12 %, Asia at 11 % and the Middle East & Africa at 7%, while North America grew by 11% driven by acquisitions. The growth in Asia was supported by China and Southeast Asia. In Latin America, demand declined by 5% in local currency against a strong comparable base and as a result of the weaker economic environment mainly in Brazil.

Care Chemicals and Plastics & Coatings continued their robust growth trends. Care Chemicals sales rose by 9% in local currency to CHF440M supported by growth in both the Consumer Care and the Industrial Applications businesses. Sales in Plastics & Coatings increased by 6% in local currency to CHF673M with a particularly strong regional development in Europe.

Natural Resources sales grew by 17% in local currency and reached CHF347M, bolstered by acquisitions. In the difficult industry environment, the underlying Oil and Mining Services sales were slightly negative but were helped by acquisitions. Functional Minerals continued its solid growth development. Sales in Catalysis were up by 2% in local currency to CHF142M with a soft demand recovery in the Asian and European markets.

The EBITDA before exceptional items significantly increased by 10% in local currency and reached CHF250M, compared to CHF229M in the previous year. This absolute profitability improvement was driven by all Business Areas.

As a result, the corresponding EBITDA margin before exceptional items increased to 15.6% versus 15.5% yr-on-yr. All Business Areas delivered EBITDA margins in-line with expectations. Most Business Areas matched a strong previous year despite the lower contribution from the seasonal Refinery and Aviation businesses due to the milder winter.

Outlook 2017 – Continued progression in profitability and operating cash flow generation

Clariant expects the uncertain environment, characterised by a high volatility in commodity prices, currencies, as well as political uncertainties, to continue. In emerging markets, we anticipate the economic environment to remain challenging and volatile; we expect moderate growth in the USA, while growth in Europe is expected to remain stable.

For 2017, in spite of a continued challenging economic environment, Clariant is confident to be able to achieve growth in local currency, as well as progression in operating cash flow, absolute EBITDA and EBITDA margin before exceptional items.

Clariant confirms its mid-term target of reaching a position in the top tier of the speciality chemicals industry. This corresponds to an EBITDA margin before exceptional items in the range of 16% to 19% and a return on invested capital (ROIC) above the peer group average.