MOSCOW (MRC) -- Brenntag’s third-quarter profits rose year on year on the back of strong demand at its commodity and specialty chemical divisions, although the CEO of the Germany-headquartered distributor warned that market disruption would last “well into” 2022, said the company.
Base chemical division Brenntag Essentials saw a 29% annual increase in operating earnings before interest, taxes, depreciation and amortisation (EBITDA) on demand growth in Europe and the Americas. COVID-19 restrictions and environmental policy in China hit its Asia-Pacific performance.
Specialties division earnings rose 42% year during the quarter, with profits growing across all divisions, driven in particular by demand from the Americas. Site closures, redundancies and the shift from geographic divisions to commodity and specialty arms contributed EUR70m to operating EBITDA for the year so far.
Known as Project Brenntag, the process has seen the firm close 68 of 100 planned sites and made 740 out of a planned 1,300 redundant. The company confirmed full-year operating EBITDA guidance of EUR1.26-1.32bn, despite no expectation of an end to “exceptional and challenging” market conditions.
As per MRC, Brenntag, the market leader in chemical and ingredients distribution, has completed the process of changing from a German Aktiengesellschaft (AG), or stock corporation, to a European company, or Societas Europaea (SE). The company says it is now doing business as Brenntag SE. The conversion, which was announced by the company's management and supervisory boards in 2019 and approved at its 2020 annual shareholders' meeting, came into force when it was entered into the commercial register on 1 February 2021.
As MRC informed earlier, in April 2020, Brenntag say it had acquired the operating assets of Suffolk Solutions’ (Suffolk, Virginia) caustic soda distribution business. Financial terms of the deal have not been disclosed.