German speciality chemicals maker Lanxess said it expects its adjusted core profit to rise by up to a quarter in 2022 as it is able to pass on soaring raw material and energy costs to customers through higher prices, said the company.
Lanxess second-quarter net profit dipped by 7% year on year on lower margins amid rising raw material and energy prices. Operating profit margin slipped to 4.9% in April-June 2022, from 5.7% in the previous corresponding period.
“In an economic environment driven by sharply rising raw material and energy prices, all segments achieved higher sales than in the previous year in both the second quarter and the first six months,” Lanxess said in a statement.
The German firm said that there was a positive contribution from businesses acquired from Emerald Kalama Chemical in 2021, while its high performance materials business unit is recognised as a discontinued operation, with restated prior-year figures for sales and EBITDA. In the first half of the year, EBITDA pre-exceptionals rose by 14.5% year on year to EUR253m.
For the whole of 2022, Lanxess expects EBITDA pre-exceptionals to be between €900m-€1bn from around €800m in the previous year.
As per MRC, Lanxess said it was suspending its business activities in Russia due to the war in Ukraine. Thus, the company had “suspended business activities with Russian customers as far as contractually possible until further notice” and had suspended all investments in Russia. Its sales in Russia and Ukraine made up less than 1% of its global sales, it said.
Lanxess is a leading specialty chemicals company with about 19,200 employees in 25 countries. The company is currently represented at 74 production sites worldwide. The core business of LANXESS is the development, manufacturing and marketing of chemical intermediates, additives, specialty chemicals and plastics. Through Arlanxeo, the joint venture with Saudi Aramco, Lanxess is also a leading supplier of synthetic rubber.
mrchub.com