Strong start to 2015—Outlook raised
• Group sales grew 7 percent year-on-year to €3.4 billion
• Considerable improvement in adjusted EBITDA to €650 million (+40 percent)
• Adjusted EBITDA margin at a high level of 19 percent
• Adjusted net income increased substantially to €320 million (+63 percent)
• Outlook for fiscal 2015 raised: sales slightly above prior year, adjusted EBITDA expected to be at least €2.2 billion
Essen. Specialty chemicals company Evonik Industries started 2015 with a strong performance, generating one of its best quarterly results since 2009.
"The positive trend observed in the second half of 2014 has continued," said Klaus Engel, Chairman of the Executive Board of Evonik Industries AG, today, when the company published its key financial data for the first quarter. "Looking at our clear earnings increase, it is pleasing to see that three quarters of our 22 business lines were able to improve their earnings year-on-year," he continued. Looking forward, he is optimistic about 2015 as a whole: "We should exceed the targets previously forecast for 2015."
The Nutrition & Care and Resource Efficiency segments posted dynamic growth and raised volumes considerably year-on-year thanks to buoyant global demand. Capacity utilization at the production facilities that came on stream last year is therefore already good. Selling prices in the Nutrition & Care segment rose considerably, whereas prices in the Performance Materials segment slipped further, mainly because of the drop in the oil price. The price effects in the segments balanced each other out, so the Group's selling prices were stable overall. The Group's adjusted EBITDA improved considerably compared with both the previous quarters and the prior-year period. This was also driven principally by the Nutrition & Care and Resource Efficiency segments. In addition, currency effects had a positive influence on sales and earnings growth.
Outlook for 2015 raised
In view of the positive business trend in the first quarter, Evonik is raising its outlook for fiscal 2015. The company still anticipates that sales will rise slightly (2014: €12.9 billion). The forecast for adjusted EBITDA is now at least €2.2 billion (2014: €1,882 million), whereas at the start of the year a slight rise was assumed. Compared with the outlook given at the start of the year, the expected sales and earnings development now includes positive exchange rate effects (based on assumed euro/US dollar exchange rate of US$1.13, previously: around US$1.30).
The Nutrition & Care segment posted sales of €1,229 million (Q1 2014: €962 million, +28 percent) and increased adjusted EBITDA substantially to €353 million (Q1 2014: €186 million). The adjusted EBITDA margin was excellent at 28.7 percent. This segment benefited from higher volumes and a considerable improvement in selling prices, especially for amino acids for animal nutrition.
The Resource Efficiency segment registered stable selling prices and higher demand for its products. Sales were €1,124 million, which was above the level in the first quarter of 2014 (€999 million, +13 percent). Almost all business activities contributed to the successful performance. Adjusted EBITDA rose 10 percent to €244 million. The adjusted EBITDA margin remained very good at 21.7 percent.
In the Performance Materials segment, sales were €851 million, 15 percent lower than in the prior-year period. Adjusted EBITDA was €72 million. The adjusted EBITDA margin increased slightly to 8.5 percent. The main reasons for this segment's development were lower volumes and, in particular, a drop in selling prices due to the lower oil price.
Evonik, the creative industrial group from Germany, is one of the world leaders
in specialty chemicals. Profitable growth and a sustained increase in the value of the company form the heart of Evonik’s corporate strategy. Its activities focus on the key megatrends health, nutrition, resource efficiency and globalization. Evonik benefits specifically from its innovative prowess and integrated technology platforms. Evonik is active in over 100 countries around the world. In fiscal 2014 more than 33,000 employees generated sales of around €12.9 billion and an operating profit (adjusted EBITDA) of about €1.9 billion.
Evonik Industries has been producing specialty chemical products in the Greater China region (Mainland China, Hong Kong and Taiwan) since the late 1970’s; with wide-ranging trading relations already in place prior to this in the region. Evonik regards Greater China as one of the driving forces of the global economy and we consequently endeavour to grow our business in the region. The company now has around 3,000 employees in the Greater China region, the regional sales reached over €1.1 billion in 2014.
In so far as forecasts or expectations are expressed in this press release or where our statements concern the future, these forecasts, expectations or statements may involve known or unknown risks and uncertainties. Actual results or developments may vary, depending on changes in the operating environment. Neither Evonik Industries AG nor its group companies assume an obligation to update the forecasts, expectations or statements contained in this release.