Global economic crisis burdens ALTANA
Sales: down 30 percent
The specialty chemicals Group Altana is strongly affected by the worldwide economic crisis and reports significant decreases in sales and earnings, according to the company. In the first quarter of the business year 2009, sales fell by 30% to €251.8 million; in the prior-year period sales had amounted to €357.6 million. Earnings before interest, taxes, depreciation and amortization (EBITDA) decreased by 71% from €71.7 million in 2008 to €20.8 million. As a consequence, the EBITDA margin was down to 8.3% and is therefore significantly lower than the prior-year figure of 20.1%. At €0.4 million, following €52.9 million in 2008, earnings before taxes (EBT) remained slightly positive despite the significant decrease in sales and EBITDA.
Development of the divisions
Sales in the BYK Additives & Instruments division fell by 34% from €120.2 million in the first quarter of 2008 to €79.0 million. The ECKART Effect Pigments division recorded a sales decrease of 39% to €57.6 million from €93.9 million in the prior year. At ELANTAS Electrical Insulation sales dropped by around 27% to €64.5 million; in the prior year sales had amounted to €88.1 million. In the ACTEGA Coatings & Sealants division sales remained relatively stable, decreasing by about 8% from €55.4 million in the prior year to €50.7 million in the first quarter of 2009.
Measures to improve efficiency and cut costs prove effective
In the late summer 2008, ALTANA had already introduced a comprehensive program to improve efficiency and cut costs. It comprises, among others, a reduction of personnel costs due to operational shutdown periods and short-time work, the postponement of investment measures and a worldwide qualified hiring freeze. In total, the estimated savings potential for 2009 amounts to approximately €50 million; more than €10 million were realized in the first quarter of the current business year.
“Despite our broad positioning in the market, the worldwide economic crisis has also affected ALTANA,“ stated Dr. Matthias L. Wolfgruber, CEO of ALTANA AG. “In such difficult times we are in an advantageous position of having a solid financial structure.“ The company’s present focus was on maintaining margins and cash flow as well as on a consistent and successful implementation of the set of measures to reduce costs, said Dr. Wolfgruber, adding that ALTANA’s business model was still intact. ”We wish to emerge strengthened from this crisis, building on our innovative strength and market position,“ continued Dr. Wolfgruber.
Outlook
The general economic conditions for ALTANA are still influenced by very high uncertainty. This is true for almost all customer industries and regions. Against the background of the company’s business performance in the first quarter of 2009 and the present order situation, the company expect the market environment to remain very difficult with a significantly declining sales and earnings development in comparison to 2008 for the business year 2009. Due to the high uncertainty in the economic environment it is not possible at present to provide any concrete sales and earnings forecast.
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