In a challenging environment with increased raw material and energy costs and difficult logistics conditions, LANXESS increased its earnings again: EBITDA pre exceptionals was EUR 253 million in the second quarter of 2022, 14.5 percent higher than the prior-year quarter’s figure of EUR 221 million.
The Specialty Additives and Consumer Protection segments grew strongly. Businesses with consumer protection products benefited significantly from the contribution of the new Flavors & Fragrances business unit. This unit comprises the specialty chemicals for the consumer goods sector from U.S. company Emerald Kalama Chemical acquired in 2021.
In the second quarter, LANXESS again passed on significantly increased raw material and energy costs to the market via significantly higher selling prices. The change in exchange rates also had a positive influence on earnings development in all segments.
The ongoing difficult logistics situation combined with higher freight costs resulted in lower volumes and prevented a further earnings increase. The Group’s EBITDA margin pre exceptionals was 12.7 percent, against 15.0 percent in the prior-year quarter.
“Despite the challenging environment, we remain firmly on the right track. The good results of the second quarter show that our strategic development is bearing fruit. By acquiring Emerald Kalama Chemical, we have significantly strengthened the Consumer Protection segment and have become even more stable,” says Matthias Zachert, Chairman of the Board of Management of LANXESS AG. “In the second half of the year, a rougher wind will blow in the global economy, but we are prepared for this.”
Group sales of EUR 1.999 billion were a considerable 36.1 percent higher than the prior-year quarter’s EUR 1.469 billion. The higher selling prices in particular had a positive effect. Net income from continuing operations amounted to EUR 48 million in the second quarter, slightly above previous year’s figure of EUR 47 million.
Since the Group announced its contribution of the High Performance Materials (HPM) business unit to a joint venture with the private equity investor Advent International in May 2022, the unit has been retroactively recognized as “discontinued operations” as of January 1, 2022. Sales and operating earnings – and the corresponding prior-year figures – were restated.
For the full year 2022, the Group has confirmed and specified its guidance of significant growth: LANXESS anticipates EBITDA pre exceptionals of EUR 900 million to EUR 1 billion. Compared with the adjusted comparative prior-year level of around EUR 800 million, this would equate to an increase of 25 percent.