BASF increases sales and earnings slightly in the second quarter

MOSCOW (MRC) -- BASF, the world's largest chemicals firm by sales, posted 2% higher operating profit for the second quarter on Friday, as demand for specialty plastics for the automotive and construction industry outweighed lower oil and gas earnings, said the producer in its press release.

The group's earnings before interest and tax (EBIT), adjusted for one-off items, rose to 2.04 billion euros (USD2.24 billion) in the quarter to June, below the average estimate of 2.12 billion euros in a Reuters poll.

Operating profit at its Functional Materials and Solutions division, which mainly serves the automotive, electrical, and construction industries, jumped 29 percent to 458 million euros, while businesses such as oil and gas, crop chemicals and less specialised chemicals saw earnings decline.

The group unveiled plans on Thursday to set up separate legal entities for its underperforming pigments businesses and look into all options.

BASF, whose products include car coatings, foam chemicals, catalytic converters and mining chemicals, confirmed its 2015 forecast for flat operating profit and slightly rising sales.

As MRC informed earlier, ASF will form a global business unit (GBU) combining all of its pigments activities effective January 2016. In the second half of 2016, BASF intends to carve out its pigments business and establish separate legal entities.

BASF is the largest diversified chemical company in the world and is headquartered in Ludwigshafen, Germany. BASF produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries. BASF had sales of over EUR74 billion in 2014 and over 113,000 employees as of the end of the year.

MRC

MOSCOW (MRC) -- Global chemical company Sika AG, specializing in the production of materials for the construction and transport engineering, provided financial summary for H1 2015, said Reuters.

The revenues increased by 5.6% and amounted to 2.5 billion euros compared to the same period in 2014. The operating profit (EBIT) increased by 8.3% and reached over 275 million euros.

The net profit increased by 11.1% and amounted to 187 million euros. The sales reached a high level in all regions (Europe, Middle East and Africa, Asia Pacific Region, North America, Latin America) and exceeded the financial plan for H1 2015.

As MRC informed earlier, Sika AG reported that its net sales for the first quarter of 2015 declined 0.9% to 1.195 billion Swiss francs from 1.206 billion francs in the same quarter last year.

Sika is a specialty chemicals company with a leading position in the development and production of systems and products for bonding, sealing, damping, reinforcing and protecting in the building sector and the motor vehicle industry. Sika has subsidiaries in 90 countries around the world and manufactures in over 160 factories. Its more than 16,000 employees generated annual sales of CHF 5.6 billion in 2014.

MRC

MOSCOW (MRC) -- Uponor’s steady progress continued during the second quarter of 2015, driven by North America and Uponor Infra, said the company in its press release.

The Group’s reported net sales for April-June totalled EUR277.6 million, up 4.9% or 0.3% in constant currency. Operating profit for the Group for April-June came to EUR22.5 million, up 27.9% in like-for like terms.

The second quarter of 2015 saw an acceleration in the economic trends witnessed in the first quarter. Uponor reported continued strong performance in Building Solutions – North America. The U.S. markets maintained their strength while weak demand continued to burden the European building solutions business, with only a few markets reporting growth in the second quarter. Germany, Uponor’s largest national market in Europe, developed rather unsatisfactorily, which has also impacted on our European supply chain. Uponor Infra reported a solid profit improvement, despite flat demand and tight public finances.

As MRC informed earlier, Uponor is to invest in the construction of a plant for the manufacture of plastic pipes for the water supply systems of the Leningrad Region. According to a source from Uponor Rus, plant capacity will amount to 1 million m of pipes per year.

Uponor is an international market leader, striving to provide better plumbing, indoor climate and infrastructure solutions across Europe, North America and in other international markets. In close partnership with building industry professionals we are continuously seeking out innovative ways to ensure our systems offer the most efficient, reliable and high-performing solutions available to residential and commercial structures around the globe.
MRC

MOSCOW (MRC) -- Dow Chemical Co., the largest US chemical maker by revenue, reported second-quarter earnings that beat analysts’ estimates as the plastics business posted record profit on lower costs for oil and natural gas, said the company in its press release.

Net income rose to 97 cents/share from 73 cents a year earlier, Midland, Michigan-based Dow said Thursday in a statement. Profit excluding some items was 91 cents, exceeding the 82-cent average of 17 estimates compiled by Bloomberg. Sales declined to USD12.9 billion from USD14.9 billion, trailing the USD13 billion average estimate.

Lower prices for oil, used as a raw material for plastics in Europe, and propane, a gas liquid used for the same purpose in the US, contributed to the highest ever second-quarter earnings in the plastics unit, Dow’s largest business.

Dow chairman and CEO Andrew Liveris is focusing on more profitable units such as agriculture and plastic packaging and is selling the chlorine business on which the company was founded 118 years ago. "We see growing momentum in construction, packaging and automotive markets outweighing some softness in agriculture and energy-related markets," Liveris said in the statement.

Sales volumes in the quarter climbed 3%, led by a 9% gain in plastics. Geographically, Greater China led volume gains with 9% growth, followed by a 7% improvement in the region that includes Europe, the Middle East, Africa and India.

Dow’s average prices fell 12% in the quarter due to a stronger dollar and lower oil prices. Margins expanded in the plastics unit as oil prices fell 42% from a year earlier, while prices declined 15%, largely because the company makes specialty products that hold their value, Liveris said Thursday in a Bloomberg Television interview.

In the plastics unit, earnings before interest, taxes, depreciation and amortization rose 15% to USD1.17 billion, Dow said. Ebitda was USD1.5 billion including an acquisition- related gain.

Company-wide profit margins widened by nearly 4% points, the 11th consecutive quarterly expansion, due to gains in the plastics and performance materials units, Dow said.

Dow agreed in March to sell the chlorine business to Olin Corp. in a USD5 billion cash-and-stock transaction that will leave Dow shareholders holding 50.5% of an enlarged Olin. The deal is expected to be completed by the year-end.

Dow said it plans to eliminate 1,750 jobs due to the chlorine business separation. That resulted in a restructuring charge of USD375 million that was excluded from adjusted earnings. Also excluded was a USD349 million gain related to the acquisition of Dow’s 50% stake in Univation Technologies, a plastics venture, from ExxonMobil.

The Dow Chemical Company is an American multinational chemical corporation. As of 2007, it is the second-largest chemical manufacturer in the world by revenue (after BASF) and as of February 2009, the third-largest chemical company in the world by market capitalization (after BASF and DuPont). Dow is a large producer of plastics, including polystyrene, polyurethane, polyethylene, polypropylene, and synthetic rubber.


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