- Sales grow thanks to strong U.S. dollar, increased demand and acquisition of Novolyte Performance Materials
- Higher availability leads to pressure on margins, especially for amines and polyalcohols
- Earnings below very good prior-year level due to higher fixed costs
- Outlook 2013: Increase in sales, particularly in polyalcohols and acids as well as butanediol and derivatives; earnings at 2012 level
Intermediates – Sales by region
(Location of customer)
In the Intermediates division, sales to third parties in 2012 amounted to €2,910 million, representing an increase of €206 million compared with the previous year (volumes 4%, prices –2%, portfolio 1%, currencies 5%). Particularly in the second and third quarters, demand for intermediates was higher than in 2011, especially in Asia. A strong U.S. dollar and the acquisition of Novolyte Performance Materials additionally boosted sales growth.
We were able to significantly increase sales and volumes in the butanediol and derivatives product line; however, scheduled plant shutdowns in Geismar, Louisiana, and Ludwigshafen raised our costs in this area. Greater availability in all regions led to pressure on margins, particularly for amines and polyalcohols.
Despite higher volumes overall, income from operations did not match the very high level of the previous year. This was mostly due to higher fixed costs as a result of the startup of new plants, the acquisition of Novolyte and the renovation of production facilities.
We increased our annual global capacity for the production of the intermediate PolyTHF® from 185,000 metric tons to 250,000 metric tons. Furthermore, we began construction of a formic acid plant in Geismar, Louisiana, in 2012, which will strengthen our Production Verbund in North America.
We anticipate renewed sales growth in 2013, particularly in the product lines for polyalcohols and acids, as well as butanediol and derivatives. We aim to offset pressure on margins by reducing fixed costs and to achieve earnings at the level of 2012.