- Email: [email protected]
Mixed results for Songwon Industrial in 2Q 2018
FINANCIALS
FINANCIALS Mixed results for Songwon Industrial in 2Q 2018
F
or the second quarter of 2018, South Korean polymer stabilizers major Songwon Industrial achieved consolidated sales of KRW197.84 billion (c. E152 million), an increase of 5.9% from KRW186.74 billion a year earlier. However, profitability declined during the quarter, with gross profit falling by 19% year on year to KRW35.77 billion, EBITDA down 21.5% to KRW20.69 billion and net profit 33.4% lower at KRW8.18 billion. The corresponding margins also decreased compared to the previous year’s figures. The company reports that higher raw material costs and negative foreign currency effects impacted all of its businesses in the second quarter of 2018, resulting in the lower overall profitability compared to 2Q 2017. Gross profit and its associated margin were affected by the reclassification in 2018 of outbound logistic costs from ‘Selling, General & Administration’ (SG&A) to ‘Cost of Services’ in compliance with the new mandatory K-IFRS 1115 standard, Songwon explains. As far as revenues are concerned, Songwon says that the improved figure in 2Q 2018 was driven by the price increases it implemented globally across its portfolio in the last quarter of 2017. In the more favourable market environment experienced this year, these increased prices successfully offset the elevated key raw material prices, it comments. However, the company introduced a further increase in the prices for its key polymer stabilizers range of up to 15%, effective from 1 July 2018 or as contracts allowed, citing the ‘rising costs of resources and services, especially raw materials, energy and logistics’. High capacity utilization levels at Songwon’s production sites throughout the second quarter also helped to optimize the group’s cost position. Looking at the company’s sales development in more detail, the polymer stabilizers segment, which is by far the largest segment in Songwon’s product portfolio, achieved sales of KRW138.59 billion in 2Q 2018, up 6.6% from the previous year. Its second-largest segment, tin intermediates, experienced year-on-year sales growth of 15.9% to KRW23.80 billion. Sales declined in most other segments to some degree. The company reports that, although its
October 2018
expectations for the quarter were met in terms of sales and revenues, volume were slightly behind due to scheduled production shutdowns during the period together with shortages of certain raw materials. By region, Songwon’s sales in Korea dropped by 7.3% to KRW44.22 billion in 2Q 2018 but grew by 15.7% to KRW56.84 billion in the rest of Asia. Sales in Europe rose 15.4% to KRW44.34 billion and by 2.7% in the Americas to KRW41.39 billion. Sales were on a par with the previous year in Australia, and the Middle East and Africa. In the first half of 2018, the Songwon group reported consolidated sales of KRW388.31 billion, up 7.4% compared to KRW361.707 billion in the first six months of 2017. Demand was solid across the portfolio in line with expectations, with the polymer stabilizers segment performing particularly well, the company reports. Net profit for the six-month period declined by 4.1% to KRW19.72 billion. More information: www.songwon.com
Nabaltec’s revenues reach record high in the first half of 2018
R
evenue growth continued at German flame retardants and fillers producer Nabaltec AG in the first half of 2018. Revenues for the sixmonth period climbed 3.5% to a record high of E91.8 million, up from E88.7 million in 1H 2017. The company’s second-quarter revenues were up 3.1%, from E45.1 million in 2Q 2017 to E46.5 million this year. Operating profit (EBIT) in the first half of 2018 was €9.71 million, up slightly on the EBIT figure of €9.65 million the year before. The EBIT margin (EBIT as a percentage of total performance) was 10.7% in 1H 2018. Nabaltec posted EBITDA of €15.6 million for the first six months of 2018, up 1.3% from €15.4 million in the same period last year. Net consolidated earnings (earnings after both interest and tax have been deducted) came to €5.1 million in 1H 2018, corresponding to earnings per share (EPS) of €0.58, compared with net consolidated earnings and EPS of €6.01 million and €0.76, respectively, a year earlier. Total comprehensive income, which includes after-tax currency translation and net income from hedge accounting, was €6.27 million in 1H 2018, up from €5.15 million in 1H 2017, due largely to positive
Additives for Polymers
9
FINANCIALS Mixed results for Songwon Industrial in 2Q 2018
F
or the second quarter of 2018, South Korean polymer stabilizers major Songwon Industrial achieved consolidated sales of KRW197.84 billion (c. E152 million), an increase of 5.9% from KRW186.74 billion a year earlier. However, profitability declined during the quarter, with gross profit falling by 19% year on year to KRW35.77 billion, EBITDA down 21.5% to KRW20.69 billion and net profit 33.4% lower at KRW8.18 billion. The corresponding margins also decreased compared to the previous year’s figures. The company reports that higher raw material costs and negative foreign currency effects impacted all of its businesses in the second quarter of 2018, resulting in the lower overall profitability compared to 2Q 2017. Gross profit and its associated margin were affected by the reclassification in 2018 of outbound logistic costs from ‘Selling, General & Administration’ (SG&A) to ‘Cost of Services’ in compliance with the new mandatory K-IFRS 1115 standard, Songwon explains. As far as revenues are concerned, Songwon says that the improved figure in 2Q 2018 was driven by the price increases it implemented globally across its portfolio in the last quarter of 2017. In the more favourable market environment experienced this year, these increased prices successfully offset the elevated key raw material prices, it comments. However, the company introduced a further increase in the prices for its key polymer stabilizers range of up to 15%, effective from 1 July 2018 or as contracts allowed, citing the ‘rising costs of resources and services, especially raw materials, energy and logistics’. High capacity utilization levels at Songwon’s production sites throughout the second quarter also helped to optimize the group’s cost position. Looking at the company’s sales development in more detail, the polymer stabilizers segment, which is by far the largest segment in Songwon’s product portfolio, achieved sales of KRW138.59 billion in 2Q 2018, up 6.6% from the previous year. Its second-largest segment, tin intermediates, experienced year-on-year sales growth of 15.9% to KRW23.80 billion. Sales declined in most other segments to some degree. The company reports that, although its
October 2018
expectations for the quarter were met in terms of sales and revenues, volume were slightly behind due to scheduled production shutdowns during the period together with shortages of certain raw materials. By region, Songwon’s sales in Korea dropped by 7.3% to KRW44.22 billion in 2Q 2018 but grew by 15.7% to KRW56.84 billion in the rest of Asia. Sales in Europe rose 15.4% to KRW44.34 billion and by 2.7% in the Americas to KRW41.39 billion. Sales were on a par with the previous year in Australia, and the Middle East and Africa. In the first half of 2018, the Songwon group reported consolidated sales of KRW388.31 billion, up 7.4% compared to KRW361.707 billion in the first six months of 2017. Demand was solid across the portfolio in line with expectations, with the polymer stabilizers segment performing particularly well, the company reports. Net profit for the six-month period declined by 4.1% to KRW19.72 billion. More information: www.songwon.com
Nabaltec’s revenues reach record high in the first half of 2018
R
evenue growth continued at German flame retardants and fillers producer Nabaltec AG in the first half of 2018. Revenues for the sixmonth period climbed 3.5% to a record high of E91.8 million, up from E88.7 million in 1H 2017. The company’s second-quarter revenues were up 3.1%, from E45.1 million in 2Q 2017 to E46.5 million this year. Operating profit (EBIT) in the first half of 2018 was €9.71 million, up slightly on the EBIT figure of €9.65 million the year before. The EBIT margin (EBIT as a percentage of total performance) was 10.7% in 1H 2018. Nabaltec posted EBITDA of €15.6 million for the first six months of 2018, up 1.3% from €15.4 million in the same period last year. Net consolidated earnings (earnings after both interest and tax have been deducted) came to €5.1 million in 1H 2018, corresponding to earnings per share (EPS) of €0.58, compared with net consolidated earnings and EPS of €6.01 million and €0.76, respectively, a year earlier. Total comprehensive income, which includes after-tax currency translation and net income from hedge accounting, was €6.27 million in 1H 2018, up from €5.15 million in 1H 2017, due largely to positive
Additives for Polymers
9