- Sales rise due to good economic environment in first half as well as inclusion of Cognis businesses
- Positive business development, especially in dispersions, resins and additives
- Earnings increase compared with previous year
- Outlook 2012: significant sales growth; earnings at previous year’s level
Dispersions & Pigments – Sales by region
(Location of customer)
In 2011, our sales to third parties were €3,509 million, an increase of €312 million over the previous year (volumes 2%, prices 8%, portfolio 2%, currencies –2%). This sales increase resulted from the generally good economic environment in the first half of the year as well as from the restocking of inventories along the entire value-adding chain. However, at the beginning of the second half, economic growth weakened considerably and our customers began to focus heavily on restrictive inventory management. We were nevertheless able to increase our sales in this period thanks to the inclusion of the Cognis businesses.
Sales in our pigments business area matched the very good level of the previous year and increased significantly in dispersions, resins and additives. We were mostly able to pass on increased raw material costs to the market via higher sales prices, especially in our business with dispersions and resins.
In the resins business, we also benefited from better availability of raw materials as well as the inclusion of the Cognis business. In our additives business, our sales grew thanks in part to the success of our business with specialties for the manufacture of liquid crystal displays, which were in high demand in Asia in the first half of the year. The acquired Cognis activities were also an additional driver of sales growth in this business.
Despite the inclusion of the Cognis business, we have reduced our fixed costs thanks to our continued cost discipline and the realization of further synergies from the Ciba integration. Thanks to strong business performance during the first half of the year, income from operations rose.
We expect demand for our products to continue to grow in 2012. We also expect growth in our key customer industries – automotive, construction and packaging – in the coming year; our sales will likely rise significantly compared with 2011 levels. However, increasing product availability on the market will lead to growing pressure on our margins. Overall, we expect earnings in 2012 to match the previous year’s level.