Performance Products

2nd Quarter 2018

Sales in the Performance Products segment declined slightly year on year. The main driver was negative currency effects in all divisions, mostly relating to the U.S. dollar. Lower volumes in the Nutrition & Health and Care Chemicals divisions, as well as portfolio effects in the Performance Chemicals and Dispersions & Pigments divisions also had a dampening effect on sales. By contrast, sales were positively impacted by higher sales prices. We slightly increased income from operations (EBIT) before special items compared with the prior-year quarter thanks to lower fixed costs and higher margins.

Factors influencing sales, Performance Products
2nd quarter 2018

Dispersions & Pigments

In the Dispersions & Pigments division, sales were slightly below the prior-year level. This was mainly attributable to negative currency effects. The divestiture of the production site for styrene butadiene-based paper dispersions in Pischelsdorf, Austria, also reduced sales slightly. Higher sales volumes in the dispersions business in particular had an offsetting effect. EBIT before special items declined considerably year on year, mainly due to lower margins as a result of currency effects.

Care Chemicals

The Care Chemicals division recorded a considerable year-on-year decline in sales, largely as a result of negative currency effects. Slightly lower sales volumes, particularly in the hygiene business and for oleochemical surfactants and fatty alcohols, also contributed to the sales decrease. By contrast, higher sales prices had a positive impact on sales. EBIT before special items considerably exceeded the figure for the second quarter of 2017 due to higher margins and lower fixed costs.

Nutrition & Health

Sales in the Nutrition & Health division decreased considerably compared with the prior-year quarter. This was mainly attributable to lower volumes, primarily because of the lower availability of citral-based products. On October 31, 2017, a fire occurred during startup of the citral plant in Ludwigshafen, Germany. As a result, we had to declare Force Majeure for all citral and isoprenol-based aroma ingredients, and consequently for vitamin A, vitamin E and several carotenoid products. We lifted Force Majeure for vitamin A and E products in the animal nutrition business in July 2018. Sales were also reduced by negative currency effects. Prices rose significantly, especially in the animal nutrition business. Fixed costs were lower; EBIT before special items considerably exceeded the figure for the second quarter of 2017.

Performance Chemicals

In the Performance Chemicals division, sales declined slightly as against the prior-year quarter. This was primarily due to negative currency effects. Sales were also reduced by the transfer of BASF’s leather chemicals business to the Stahl group. By contrast, sales were lifted by higher volumes, particularly of mining chemicals, automotive liquids and mineral oil additives. Prices also rose slightly, especially for fuel, lubricant and plastic additives. EBIT before special items declined considerably compared with the second quarter of 2017, mainly due to higher fixed costs.