LANXESS, a specialty chemicals company, anticipates a 10 to 20 percent increase in earnings for the current fiscal year, despite weak first-quarter results influenced by the global economic environment in the chemical industry.
EBITDA pre exceptionals was EUR 101 million, 46.6 percent lower than the previous year's EUR 189 million. The decline in earnings was primarily attributed to lower sales prices and continued weak demand across numerous customer industries.
However, compared to the fourth quarter of 2023, there are indications of a slight upward trend, mainly due to increased sales volumes. Sales rose by 11.9 percent from EUR 1.436 billion to EUR 1.607 billion, while EBITDA pre exceptionals increased by 4.1 percent to EUR 101 million compared to EUR 97 million in the previous quarter. The Advanced Intermediates and Specialty Additives segments showed particularly strong growth in EBITDA pre exceptionals.
Matthias Zachert, CEO of LANXESS AG, noted that while the chemical industry may have reached its economic bottom, it is premature to declare an all-clear. He expects the positive trend to continue in the second quarter and improved results for the year overall compared to 2023, though 2024 will likely remain challenging for the chemical industry.
LANXESS anticipates a slight upturn in demand for the remainder of the year, along with higher capacity utilization and an improved cost base resulting from structural measures in its FORWARD! action plan. For the full year 2024, the Group expects an increase in EBITDA pre exceptionals of 10 to 20 percent compared to the previous year's EUR 512 million. Sequential increases are expected in the second and third quarters, with a more subdued development in the fourth quarter due to normal seasonal patterns.
The report also details the performance of individual segments, including Consumer Protection, Specialty Additives, and Advanced Intermediates, providing figures on sales and EBITDA pre exceptionals for each. All segments experienced declines in sales and earnings compared to the previous year, with varying factors such as lower volumes, weaker demand, and lower sales prices impacting their performance.