Lanxess raises earnings forecast on back of good Q1 2016 results

Following what it says was “a good first quarter,” specialty chemicals company Lanxess has raised its earnings forecast for fiscal 2016. The company now expects to achieve EBITDA pre-exceptionals between €900 million and €950 million, as opposed to previously assumed figure of €880 million to €930 million.

“We started fiscal 2016 with a good first quarter and the second quarter has begun well. For this reason, we are raising our guidance for the full year,” said Matthias Zachert, chairman of the Lanxess Board of Management.

EBITDA pre-exceptionals climbed by around 14 per cent in the first quarter of 2016 to €262 million. This positive development was largely attributable to increased volumes, higher capacity utilisation, positive currency effects and the absence of the ramp-up costs incurred in the first quarter of 2015 for the new rubber plants in Asia. The EBITDA margin pre-exceptionals rose to 13.6 per cent from 11.2 per cent a year earlier.

Net income in Q1 2016 more than doubled and amounted to €53 million Earnings per share were €0.58. Sales decreased by just under six per cent to €1.92 billion, a decline mainly resulting from adjustments in selling prices to reflect lower raw material prices. In the first quarter of 2016, Lanxess’s net financial liabilities were virtually unchanged at €1,216 million, compared with €1,211 million at the end of 2015.

“Our good business performance shows that Lanxess is becoming more stable and more profitable,” Zachert continued. “This positive development is supporting our growth course, on which we have already made further headway also in this year.”