- Sales increase due to greater volumes
- Earnings below previous year’s level primarily as a result of negative development of construction sector in Spain and North Africa
- Outlook 2012: significant sales and earnings increase thanks to economic recovery in key markets as well as to measures for improving our efficiency
Construction Chemicals – Sales by region
(Location of customer)
Compared with the previous year, we increased our sales to third parties in 2011 to €2,181 million (2010: €2,121 million). Negative currency effects were more than offset by higher volumes (volumes 4%, prices 1%, currencies –2%).
Our business performance varied considerably by region: In China, India, Russia and Saudi Arabia, our sales rose significantly once again thanks to strong demand. Although the market environment in North America remained challenging, we also improved our sales in that market in local-currency terms. Furthermore, our sales grew in the important European markets of France and Germany, as well as in Northern Europe, as a result of the recovery in the construction sector. In contrast, we experienced a sharp drop in sales in Southern Europe; in Spain in particular, the economic conditions in the construction industry worsened again. The tense political situation in North Africa negatively impacted our business in this region.
Income from operations was below the level of the previous year due primarily to the negative development in the construction industry in Spain and North Africa. Furthermore, the market recovery we had forecast in North America failed to materialize. We were therefore only partially able to pass on higher raw material costs to our customers. In Spain, we adapted our sales structures to the weak market environment; the resulting expenses also had a negative impact on earnings.
We expect the following developments in our important markets in 2012: In Northern and Western Europe as well as Japan, growth will continue in the construction sector, while building activity in China will continue to increase at a strong pace. Furthermore, we expect substantial growth in South America, Turkey and Saudi Arabia. Thanks to this economic recovery and based on measures for improving our efficiency, we aim to significantly improve sales and earnings in 2012.