Clariant Says Outpacing Cosmetic-Good Rivals as 2014 Starts WellPatrick Winters
Clariant AG, the Swiss maker of emulsifiers and pearlizing additives for shampoo, is outpacing competitors in the cosmetics industry, with the year getting off to a “positive start,” according to Chief Financial Officer Patrick Jany.
The company got a boost from product launches at the consumer-care business last fall, with growth of about 5 percent, Jany said. That helped offset lower sales of aircraft de-icing chemicals and unfavorable currency movements.
“As far as I believe, it’s better than our competitors,” Jany said. “It’s probably based on innovation, we have a lot of new products and solutions.”
Competition in the consumer-care ingredient industry is stiffening as companies from Lonza Group AG to Croda International Plc and BASF SE increase the rate of innovation to tap demand for active ingredients based on more natural products. Market share is getting skewed by some shampoo and cosmetic companies spending more on launches than others.
Croda on April 24 flagged weak sales of personal-care ingredients in North America where it had seen a “general quietness” around several of its biggest multinational clients. BASF reports first-quarter results on May 2.
Chief Executive Officer Hariolf Kottmann, who purchased German catalyst maker Sued-Chemie for about $2.3 billion in 2011, has been revamping Muttenz, Switzerland-based Clariant with the sale of non-core assets. Its sale of a stake in foundry chemicals-maker ASK Chemicals ends an era of larger divestments, with the focus switching to internal projects, Jany said today.
The net loss from continuing operations totaled 39 million francs ($44 million), weighed down by an 84 million-franc expense from the ASK deal. Sales of de-icing chemicals for aircraft and runways, trading under the Safewing and Safeway brands, were “virtually non-existent” in Europe because of a mild winter which led to lower-than-expected group revenues, Clariant said.
“We had some one-off effects like the weather which obviously impacted the de-icing business but even if you look at this impact we were able to compensate,” Jany said.
Clariant shares rose as much as 1.3 percent to 17.43 francs as of 9:05 a.m. in Zurich, giving the company a market capitalization of 5.8 billion francs.
Earnings before interest and taxes excluding one-time items were little changed at 140 million francs, beating analyst estimates. Sales were also stable at 1.49 billion francs. Analysts estimated 1.51 billion francs.
The company confirmed it will meet full-year sales and profitability goals.
“The underlying business environment is improving, portfolio pruning continues and cost savings from efficiency programs will continue to gain traction,” Bank Vontobel AG analyst Patrick Rafaisz said in a note to clients. He has a buy rating on the stock.