Arkema SA, which exited an unprofitable vinyls operation this year, said it aims to push annual earnings close to the 1 billion-euro ($1.2 billion) mark as it focuses on higher-margin specialty materials.
The French company forecast a “very solid year” and will give priority to “internal dynamics,” it said in a release today, without giving details. Analysts had predicted earnings before interest, taxes, depreciation and amortization of 965 million euros for 2012, according to the average of 17 estimates. The shares jumped as much as 6.6 percent in Paris.
The disposal of the low-margin vinyls business highlights Chief Executive Officer Thierry Le Henaff’s attempt to focus the company on coatings and other technology-driven markets where there’s less pressure from commodity chemical makers in Asia and the Middle East. The transaction, completed in July, has also spurred speculation that Colombes-based Arkema will become a takeover target as its shares still trade at below the average for its peer group, according to Bloomberg data.
“The beat was all in industrial chemicals, we believe largely due to a better performance in the coatings ingredients chain,” Amy Walker, an analyst at Morgan Stanley, said in a note.
Shares of Arkema traded 6.4 percent higher at 63.67 euros as of 9:02 a.m. Prior to the open, the stock traded at 8.3 times on a price to earnings basis, compared with an average 14.6 times for western European commodity chemical makers.
Second-quarter Ebitda of 306 million euros, beat the 277 million-euro estimate of JPMorgan. Revenue surged 15 percent to 1.72 billion euros, also ahead of analysts’ predictions, bolstered by the euro’s drop against the dollar and acquisitions. Ebitda for the first half totaled 559 million euros, 8.4 percent lower than a year earlier.