- Considerable improvement in sales in 2011 thanks in part to higher prices; successful business with fuel and lubricant additives
- Earnings significantly above previous year’s level thanks to strict price management and the contribution from the acquired Cognis businesses
- Outlook 2012: considerable sales growth due in part to the startup of new production facilities; earnings to improve significantly despite increase in targeted additional expenditures for research and development
Performance Chemicals – Sales by region (Location of customer)
In 2011, our sales to third parties rose by €388 million to €3,529 million (volumes –5%, prices 7%, portfolio 12%, currencies –2%). In the first quarter, there was strong demand for our products, but it then weakened over the course of the year. Due to increasing economic uncertainty, our customers reduced their inventory levels. In order to pass on the high raw material costs to the market, we successfully adapted prices in all business areas in line with our “value over volume” strategy. The overall significant sales growth was driven mainly by our strong business in fuel and lubricant solutions as well as the full-year inclusion of the integrated Cognis businesses, in addition to higher prices.
Income from operations was considerably above the level of the previous year. This development was supported by our strict price management and by the acquired Cognis businesses. In contrast, the weak U.S. dollar, the strong Swiss franc, the demand-related volume decline and the consequences of the earthquake and tsunami disaster in Japan had a negative effect on earnings.
In our plastic additives business, we want to get even closer to our customers in fast-growing regions; to this end, we began construction of a new plant for customized antioxidant blends in the Middle East.
With the acquisition of inge watertechnologies AG, we now offer solutions for ultrafiltration technology, a membrane process used in the treatment of drinking water, process water, wastewater and seawater. This acquisition also strengthens our water treatment chemicals business.
In 2012, we expect sales to rise on account of the startup of new production facilities – for example, plants for polyacrylamide and polyisobutene in Nanjing, China – as well as a slight recovery in demand. Furthermore, despite targeted additional expenditures for research and development, we expect earnings to improve significantly due to price measures already implemented, further price differentiation, measures to increase efficiency and systematic customer management.