- Sales grow sharply in all business areas and regions thanks to higher sales volumes
- Earnings in a favorable market environment far above previous year’s level
- Overall decline in special charges
- Outlook 2011: strong sales growth, boosted by Cognis acquisition; significant improvement in earnings
Care Chemicals – Sales by region
(location of customer)
At the beginning of August 2010, the business areas Nutrition Ingredients, Pharma Ingredients & Services and Aroma Chemicals were shifted from the Care Chemicals division to the newly established Nutrition & Health division. The Care Chemicals division now comprises the businesses with Personal Care, Hygiene, Home Care and Formulation Technologies. The division was reorganized to prepare for the integration of the Cognis businesses.
The Care Chemicals division posted very high sales to third parties of €2,755 million, a rise of €688 million over the previous year (volumes 14%, prices 5%, portfolio 11%, currencies 3%). Due to the sharp rise in demand, we were able to appreciably increase our sales volumes. In some product lines, we were unable to keep up with demand because of a shortage of important raw materials or because our capacities were already fully utilized. Thanks to the growth in volumes, our sales improved sharply in all business areas and regions. The greatest growth was posted by the Home Care and Formulation Technologies business areas.
Due to high demand and increased raw materials prices, we were able to raise our sales prices. Sales growth was boosted by the stronger U.S. dollar and the full-year inclusion of the integrated Ciba businesses.
In this favorable market environment, income from operations increased sharply to reach a high level. This was mainly attributable to the sales growth, improved capacity utilization and the quick and successful integration of the Ciba businesses. Special charges declined overall; these resulted from the Ciba integration and the use of inventory revalued at market prices in the course of the Cognis acquisition.
In 2011, we want to continue this successful performance. In Nanjing, China, we will start operations at our first nonionic surfactant factory in Asia. We expect a slight increase in sales volumes and a sharp rise in sales, boosted by the Cognis acquisition. Although the Cognis integration will result in special charges, we anticipate a significant increase in earnings with stable margins.