Clariant Profit Beats Estimates Helped by Consumer Care Unit
Clariant AG (CLN), a Swiss specialty chemicals maker, reported second-quarter earnings that exceeded analysts estimates, driven by growth in its care chemicals division which supplies ingredients for shampoos and enzymes.
Earnings before interest, taxes, depreciation and amortization before one-time items rose 5.6 percent from a year earlier to 211 million francs ($226 million), the company said today. That compared with the 207 million-franc estimate of 10 analysts surveyed by Bloomberg.
“We are confident that we will achieve our full-year targets,” Chief Executive Officer Hariolf Kottmann said in a statement. Assuming stable mature markets and rising uncertainties in emerging economies, Clariant will achieve further growth and improved profitability in 2013, he said.
Kottmann has ruled out transformational acquisitions as he leads Clariant away from commodity chemicals to more profitable agrochemical ingredients and catalysts for the oil and gas industry, leveraging on research and technology acquired from the $2.5 billion purchase of Sued Chemie AG in 2011.
Care chemicals was the fastest growing of Clariant’s four reported business units as sales increased 8 percent in local currencies.
Clariant shares rose as much as 1.7 percent and traded 1 percent higher at 14.25 francs as of 10:30 a.m. in Zurich. The stock has risen 18 percent this year, giving the company a market value of 4.7 billion Swiss francs.
“Clariant has again produced solid results in a difficult demand environment for the chemical industry,” Jaideep Pandya, an analyst at Berenberg Bank in London, wrote in a note to investors, adding that expectations for full-year profitability remain unchanged. Pandya has a buy rating on the stock.
The sale of paper, textile and emulsions units to New York buy-out firm SK Capital Partners is being made more difficult because of the responses from administrations in different countries, Chief Executive Officer Hariolf Kottmann said in a phone interview.
“The process is a difficult one,” said Kottmann, adding that his “firm assumption” remains that the transaction will be completed by the end of September.
Kottmann wants to exit units making leather chemicals, detergents and intermediates by the end of this year bouyed by last December’s agreement to sell three units to SK Capital for about 502 million francs. Clariant is waiting for final offers for those units, Kottmann said.
Clariant and French buyout firm Wendel SA (MF) are considering options for their leather-chemical businesses that include a merger or an outright purchase by Wendel, four people with knowledge of the situation said earlier this month.
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