LANXESS China Achieves 57% Growth in Q2       

Specialty chemicals company LANXESS achieved its best ever quarterly earnings in the second quarter of 2008. In China, the company showed a notable 57% increase in quarterly sales, adjusted for portfolio and currency effects, compared to the second quarter 2007. The main growth drivers were the Technical Rubber Products, Basic Chemicals, Semi-Crystalline Products and Rubber Chemicals business units, all of which performed strongly. The Technical Rubber Products business unit was especially successful in various niche applications like sophisticated high performance auto parts. The main reason for the positive business development in the basic chemicals business unit was the successful passing on of raw material price increases. The Semi-Crystalline Products and the Rubber Chemicals business units also grew significantly. The Semi-Crystalline Products business unit's strong growth in the region in the latest quarter was mainly contributed by the successful launch of several automotive projects. The growth contribution of the business unit Rubber Chemicals was supported by sales of the antioxidant Vulkanox, manufactured in Tongling, Anhui Province.
   Guided by the corporate strategy "LANXESS Goes Asia", the company continued its targeted investments in China to fuel the ongoing momentum of profitable growth. This June, the Inorganic Pigments business unit announced the acquisition of one of China's most modern iron oxide pigment facility in Jinshan near the city of Shanghai. (CCR2008 No. 19)
   To further reinforce the company's strength on research and development in China and across Asia, LANXESS also opened a world-class Rubber Research Center in Qingdao, Shandong province as part of its global research network. (CCR2008 No. 21)
   Currently, the company's subsidiary Rhein Chemie is building a new plant for the manufacture of lubricant additives in Qingdao and targets to go on stream later this year. The new facility, manufacturing the customized additive formulations for lubricants with improved performance and environmental standards, will drive LANXESS'S profitable growth in the fast growing Chinese market further forward.
   In addition to the remarkable result in China, LANXESS AG announces it generated net income of EUR 53 million in the second quarter. Sales of the LANXESS Group rose by 2.2%, from EUR 1 727 million in the prior-year period to EUR 1 765 million in the second quarter of 2008. Reported sales in the Asia-Pacific this region came in at EUR 323 million, up 4.2%. LANXESS achieved growth rates well into double digits in China, India and Japan.