- Sales from continuing operations decreased by 6 % in local currency to CHF 2.838 billion
- Continuing operations EBITDA at CHF 419 million
- EBITDA margin resilient at 14.8 % compared to an operational performance of 14.8 % in the first nine months of 2019
- Outlook: in a continued difficult environment amid COVID-19 resurgence, focus on impact mitigation and performance improvement in 2020
“Over the first nine months of 2020, we successfully upheld the profitability of our continuing operations despite an exceedingly challenging environment. Although the COVID-19 pandemic had a significant negative impact on several of Clariant’s key end markets in the third quarter, the performance resilience clearly validates the success of our strategic focus on the three core specialty Business Areas,” said
Key Financial Data
Continuing operations | Third Quarter | Nine Months | ||||||
in CHF million | 2020 | 2019 | % CHF | % LC | 2020 | 2019 | % CHF | % LC |
Sales | 893 | 1 043 | -14 | -7 | 2 838 | 3 272 | -13 | -6 |
EBITDA | 127 | 151 | -16 | 419 | 253 (1) | 66 | ||
- margin | 14.2 % | 14.5 % | 14.8 % | 7.7 % | ||||
EBITDA before exceptional items | 137 | 169 | -19 | 446 | 524 | -15 | ||
- margin | 15.3 % | 16.2 % | 15.7 % | 16.0 % |
(1) Including a provision of
Excluding provision: EBITDA after exceptional items at CHF 484 million, EBITDA margin 14.8 %
Nine Months 2020 – Steady EBITDA margin development despite notably softer environment
Muttenz,
As a result of the COVID-19 pandemic, the Group was confronted with a significantly lower demand environment in several segments in the first nine months of 2020. These buoyant profitability results are therefore noteworthy, as they clearly reflect the effectiveness of Clariant’s business continuity programs, as well as cash and cost measures, which have been implemented to minimize the impact of this pandemic and improve the performance in the midterm.
In the first nine months,
In the first nine months of 2020, Care Chemicals sales declined by 5 % in local currency due to weather-related weak Aviation demand in the first quarter and lower Industrial Applications sales amid the COVID-19 pandemic in the second and third quarters, which could not be offset by the growth in Consumer Care. The Catalysis Business Area’s top line declined by a modest 3 % in local currency due to both the strong comparison base as well as the subdued environment in the chemical industry. Natural Resources sales decreased by 8 % in local currency, impacted by the notably softer economic environment resulting from the decline in oil demand and the COVID-19 pandemic.
The nine months 2020 continuing operations EBITDA reached CHF 419 million and the Group successfully defended margins despite a weaker top-line development. The 14.8 % EBITDA margin remained unchanged versus 14.8 % (reported 7.7 %) in the previous year when excluding the one-off
Third Quarter 2020 – Comparatively stable profitability despite weaker
top-line development
As expected, the third quarter 2020 saw the most pronounced sales decline of the first three quarters in 2020 with a 7 % decrease in local currency in continuing operations sales to CHF 893 million. This corresponds to a 14 % decline in Swiss francs due to unfavorable currency effects. The main driver was the sales decline in Natural Resources, where all three businesses were negatively impacted by the oversupply in the oil markets and the global COVID-19 pandemic, while sales in Care Chemicals and Catalysis softened only slightly.
On a regional basis, the positive development in
In the third quarter, Care Chemicals sales softened by a mere 1 % in local currency, supported by higher Consumer Care sales. Catalysis sales also slowed by 1 % compared to a particularly strong previous year. Natural Resources sales declined by 14 % in local currency primarily because Oil and Mining Services sales were hampered by the lower consumption of oil and oil-derived products.
The continuing operations EBITDA declined to CHF 127 million and a corresponding margin of 14.2 %, slightly below the 14.5 % in the previous year. The profitability advanced in both Care Chemicals and Catalysis due to more favorable product mixes, cost mitigation and efficiency improvement. In Natural Resources, the margin reduction is attributable to lower volumes in COVID-19-exposed segments such as automotive, textile and in particular oil, which could not be counterbalanced by internal performance measures.
Discontinued Operations
For the first nine months, sales in discontinued operations declined by 25 % in local currency and by 31 % in Swiss francs. However, on a like-for-like basis, excluding
In the first nine months of 2020, the discontinued operations EBITDA was positively impacted by the gain on the disposal of the Masterbatches business in the third quarter and negatively impacted by one-off costs for the efficiency program in Pigments in the second quarter as well as for the carve out of the discontinued operations.
Outlook – Continued COVID-19 impact anticipated in the fourth quarter 2020 with small improvement versus the third quarter, while performance measures lift portfolio to achieve above-market growth, higher profitability and stronger cash generation in the mid-term
The Group’s task forces will continue to focus on the safety of our employees, support to our communities, business continuity to our customers and cash generation. Clariant’s three core specialty Business Areas will continue to execute performance programs to generate resilient results during these times and to achieve above-market growth, higher profitability and stronger cash generation in the mid-term.
In addition, the Group is significantly reshaping its portfolio through the divestment of
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Phone +41 61 469 63 63 jochen.dubiel@clariant.com | Maria Ivek Phone +41 61 469 63 73 maria.ivek@clariant.com |
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Phone +41 61 469 63 63 thijs.bouwens@clariant.com | |
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This media release contains certain statements that are neither reported financial results nor other historical information. This document also includes forward-looking statements. Because these forward-looking statements are subject to risks and uncertainties, actual future results may differ materially from those expressed in or implied by the statements. Many of these risks and uncertainties relate to factors that are beyond Clariant’s ability to control or estimate precisely, such as future market conditions, currency fluctuations, the behavior of other market participants, the actions of governmental regulators and other risk factors such as: the timing and strength of new product offerings; pricing strategies of competitors; the Company’s ability to continue to receive adequate products from its vendors on acceptable terms, or at all, and to continue to obtain sufficient financing to meet its liquidity needs; and changes in the political, social and regulatory framework in which the Company operates or in economic or technological trends or conditions, including currency fluctuations, inflation and consumer confidence, on a global, regional or national basis. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document. www.clariant.com intensify growth, and increase profitability. |
9M 2020 Media Release EN
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