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Rhodia financial report half-year ended 30 Jun 2010: Novecare
FOCUS C10, C10-C12 (commonly categorized as C8-C10), blends predominantly containing a combination of carbon chain lengths C12-C14, C12-C16, C12-C18, C14C16 (commonly categorized as C12C14) and blends predominantly containing a combination of carbon chain lengths C16-C18 (the product under investigation). The product allegedly being dumped is the product under investigation, originating in India, Indonesia and Malaysia. The complainant companies have provided evidence that the combined imports of the product under investigation from the countries concerned have increased overall in absolute terms and have also increased in terms of market share. Having determined, after consulting the Advisory Committee, that the complaint has been lodged by or on behalf of the Union industry and that there is sufficient evidence to justify the initiation of a proceeding, the Commission hereby initiates an investigation pursuant to Article 5 of the basic Regulation. The investigation will determine whether the product under investigation originating in the countries concerned is being dumped and whether this dumping has caused injury to the Union industry. If the conclusions are affirmative, the investigation will examine whether the imposition of measures would or would not be against Union interest. The procedures for making written submissions and sending completed questionnaires and correspondence are given in detail. Interested parties may request the intervention of the Hearing Officer of the DirectorateGeneral for Trade. The investigation will be concluded, according to Article 6(9) of the basic Regulation, within 15 months of the date of the publication of this notice in the Official Journal of the European Union. According to Article 7(1) of the basic Regulation, provisional measures may be imposed no later than nine months from the publication of this notice in the Official Journal of the European Union. Official Journal of the European Union, C Information and Notices, 13 Aug 2010, 53 (C219), 12-16 (European Community, website: http://eurlex.europa.eu)
OCTOBER 2010
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MARKET REVIEWS The European Personal Care Ingredients Market shows recovery in sales in 1H 2010, according to Kline The European personal care ingredients market experienced continued growth in the last few years despite the negative effects of the slow economy, reveals Global Personal Care Ingredients 2010. Market Analysis and Opportunities, a recently published study by worldwide consulting and research firm Kline & Co. The personal care ingredients market outperformed most other enduse industries in which speciality chemicals suppliers are active. Fuelled by a relatively stable consumption of cosmetics and toiletries during the crisis, the market is expected to recover quickly, as indicated by a sharp rebound in sales in 1H 2010, and is anticipated to continue to increase at an annual volume growth rate of 2.6% until 2014. While traditional ingredients will take advantage of this upturn, the largest growth expected is in the ‘green’ product area. Speciality surfactants, conditioning polymers and emollients are the leading product categories in the market, representing 23%, 18% and 16%, respectively, of a $1.74 bn total. Furthermore, boosted by increased consumer awareness about sun exposure side effects, the use of UV absorbers has extended to an increasing number of skin care products, and they now rank among the most rapidly growing markets. Most of the personal care ingredient segments are dominated by a few large companies. This is particularly evident in the case of hair fixative polymers, where the top three competitors hold 87% of the total market volume. In contrast, in segments which cover a broader range of applications, such as skin and hair care, the supplier base is more fragmented as the ingredients are widely varied. The personal care ingredients supplier basis is continuously concentrating, and the recent acquisition of Cognis by BASF confirms this trend of convergence in
the industry. Key suppliers are trying to be present in most market segments to represent a one-stopshop for cosmetics and toiletries formulators. Press release from: Kline & Co Inc, Great Notch, 150 Clove Road, Little Falls, NJ 07424, USA, tel: +1 973 435 3443 or +1 973 808 3396, website: http://www.klinegroup.com (17 Aug 2010)
Report sees decline in I&I growth Growth in global demand for industrial and institutional (I&I) cleaning chemicals is anticipated to decline, primarily due to lower selling prices, according to Freedonia Group. The I&I market will expand 4.4%/y to 2013, down from 5.6%/y in 20032008. Sales are anticipated to amount to approximately $38 bn in 2013, compared to $30 bn in 2009. North America and Western Europe together will account for about 58% of the I&I market in 2013, down from more than 60% in 2008. The US will remain the largest single market over the forecast period. The I&I market in Asia/Pacific is anticipated to grow 6.6%/year to $10.2 bn. The shift towards higher-end formulations with reduced environmental impact will continue, although commodity cleaners will retain their presence. Chemical Week, 9 Aug 2010, (Website: http://www.chemweek.com)
COMPANY RESULTS Rhodia financial report half-year ended 30 Jun 2010: Novecare For its 1H 2010 (period ends 30 Jun 2010), the Novecare segment of Rhodia SA has reported net sales of €532 M (€417 M in 1H 2010) and operating profit of €72 M (operating loss of €10 M). The positive trend in net sales stems largely from the acquisition on 27 Feb 2009 of the US surfactant producer McIntyre [Focus on Surfactants, Apr 2009], whose products serve the cosmetics and detergents markets. In addition, the positive currency conversion impact of €8 M reflects the changes mainly arising from the appreciation of the
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FOCUS Brazilian real and, to a lesser extent, the appreciation of the pound sterling and certain Asian currencies against the euro. On a constant consolidation scope and exchange rate basis, Novecare net sales improved by 20.4% in 1H 2010. The enterprise benefited from a turnaround in activity in all world regions. Recovery was quick and widespread in the industrial applications, agrochemicals and coatings markets, whereas it was gradual in the oil mining sector. Novecare volumes therefore increased 24.2% between the two reference periods, with particularly significant growth in 2Q 2010 – volumes were up 18% in 1Q 2010, and up 31% in 2Q 2010, when sales grew 30% in value terms to €287 M. Rising volumes generated a positive impact of €42 M on the segment’s operating profit. Effective pricing power enabled Novecare to record a favourable net impact (sale price/raw material costs) of €8 M for 1H 2010. The slight rise in fixed costs generated a negative €1 M impact that was fully offset by lower restructuring expenses, as last year reported important charges for the implementation of temporary and structural competitive measures. The net of these elements resulted in a positive €6 M variance between the two reference periods. The other items explaining the increase in Novecare’s operating profit include a positive consolidation scope impact of €3 M, a positive impact of €2 M relating to other operating income and expenses, a positive transactional exchange rate impact of €1 M and a positive impact of €1 M arising from the decline in depreciation, amortization and impairment. In Jun 2010, Rhodia announced its plans to acquire Feixiang Chemicals [ibid, Aug 2010], a company specializing in amines and surfactants located in Zhangjiagang near Shanghai (China). This acquisition, which should be finalized in 2H 2010, represents a unique opportunity for Rhodia to integrate speciality amine technologies into Novecare’s business portfolio. The combination of the group’s formulation expertise and end-market applications with Feixiang Chemicals’ amine technologies should reinforce Rhodia’s worldwide leadership position in speciality surfactants for the home and personal 6
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care, agrochemicals, oilfield and industrial markets, the company says. Rhodia Results 1H 2010, Jul 2010, 10-12 (Rhodia SA, Immeuble Coeur Defense, Tour A, 110 esplanade Charles de Gaulle, 92400 Courbevoie, France, tel: +33 1 5356 6464, fax: +33 1 5356 6459, website: http://www.rhodia.com)
Huntsman releases 2Q 2010 results Huntsman Corp reported revenues for 2Q 2010 of $2343 M, up 27% from $1846 M for 2Q 2009, and up 12% from 1Q 2010. Revenues increased due to higher sales volumes and higher selling prices in all divisions. Net income attributable to Huntsman for 2Q 2010 was $114 M ($406 M for 2Q 2009). For 2Q 2010, adjusted EBITDA was $257 M (EBITDA of $93 M for 2Q 2009). For 1H 2010 revenues were $4437 M ($3526 M) while the company reported a net loss of $56 M, compared to net income of $112 M in 1H 2009. For the Performance Products segment, which houses the company’s surfactants offerings, revenues were $669 M in 2Q 2010 ($482 M in 2Q 2009), and $1285 M in 1H 2010 ($982 M in 1H 2009). Year on year, average selling prices were up 12% for the second quarter with almost all product groups affected, primarily in response to higher raw material costs. Sales volume increased 27%, largely due to higher demand across all product groups and additional sales of ethylene glycol, which had previously been produced under tolling arrangements, the company reports. EBITDA for the segment was $116 M for the three months to the end of Jun 2010 compared to $31 M for the same period in 2009; and $176 M for 1H 2010 ($94 M in 1H 2009). Huntsman Corp results 2Q and 1H 2010, 5 Aug 2010, (Huntsman Corp, 3040, Post Oak Boulevard, Houston, TX 77056, USA, tel: +1 713 235 6000, fax: +1 713 235 6416, website: http://www.huntsman.com)
M (SFR 26 M), and EBIT of SFR 43 M (SFR 21 M). For its 1H 2010, this business unit has reported sales of SFR 746 M (SFR 672 M for its 1H 2009), EBITDA (before exceptional items) of SFR 116 M (SFR 40 M), EBIT (before exceptional items) of SFR 95 M (SFR 16 M), and EBIT of SFR 85 M (SFR 5 M). Sales in Performance Chemicals improved year on year as well as sequentially. Additives, Emulsions and Paper Specialties showed the strongest growth while Detergents & Intermediates grew at a more moderate pace. Emulsions experienced the highest pressure from rising raw material costs. The business unit was able to fully offset higher costs for acrylates and vinyl acetate monomers by higher sales prices. Detergents & Intermediates reported another good quarter with high capacity utilization. Clariant Results 2Q 2010, 29 Jul 2010, 9 (Clariant International Ltd, Rothaustrasse 61, CH-4132 Muttenz 1, Switzerland, website: http://www.clariant.com)
Bochemie Group reaches record sales in 1H 2010 Bochemie Group (BG) (Bohumin, Czech Republic), the manufacturer of Savo branded detergents and disinfectants, reached record sales worth CEK 570 M in 1H 2010, an increase of 10% compared to 1H 2009. In 1H 2010, BG’s sales increased most rapidly (by about tenfold to several tens of millions of CEK) in Romania, a market it entered in 2009. Sales are also increasing in Slovakia and Poland in 2010 thanks to BG’s significant marketing activities in these countries. Demand for Savo products is also increasing in the Czech Republic, with sales increasing 76% year on year in Jul 2010. Technicky Tydenik, 17 Aug 2010, 58 (16), 2 (in Czech) & Hospodarske Noviny, 10 Aug 2010, 54 (154), 18 (in Czech)
Clariant further improves profitability based on better demand and reduced cost base
Henkel defies industry trend and increases forecast
For its 2Q 2010, the Performance Chemicals business unit of Clariant International Ltd has reported sales of SFR 387 M (SFR 335 M for its 2Q 2009), EBITDA (before exceptional items) of SFR 64 M (SFR 38 M), EBIT (before exceptional items) of SFR 54
Henkel’s sales rose 11.6% in 2Q 2010 to €3.89 bn, with organic sales growth at 6.8%. 2Q EBIT was up 51.2% from €279 M to €421 M and net profits rose 90% from €143 M to €273 M. EBIT after adjusting for restructuring costs was up 54.5% at OCTOBER 2010
OCTOBER 2010
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MARKET REVIEWS The European Personal Care Ingredients Market shows recovery in sales in 1H 2010, according to Kline The European personal care ingredients market experienced continued growth in the last few years despite the negative effects of the slow economy, reveals Global Personal Care Ingredients 2010. Market Analysis and Opportunities, a recently published study by worldwide consulting and research firm Kline & Co. The personal care ingredients market outperformed most other enduse industries in which speciality chemicals suppliers are active. Fuelled by a relatively stable consumption of cosmetics and toiletries during the crisis, the market is expected to recover quickly, as indicated by a sharp rebound in sales in 1H 2010, and is anticipated to continue to increase at an annual volume growth rate of 2.6% until 2014. While traditional ingredients will take advantage of this upturn, the largest growth expected is in the ‘green’ product area. Speciality surfactants, conditioning polymers and emollients are the leading product categories in the market, representing 23%, 18% and 16%, respectively, of a $1.74 bn total. Furthermore, boosted by increased consumer awareness about sun exposure side effects, the use of UV absorbers has extended to an increasing number of skin care products, and they now rank among the most rapidly growing markets. Most of the personal care ingredient segments are dominated by a few large companies. This is particularly evident in the case of hair fixative polymers, where the top three competitors hold 87% of the total market volume. In contrast, in segments which cover a broader range of applications, such as skin and hair care, the supplier base is more fragmented as the ingredients are widely varied. The personal care ingredients supplier basis is continuously concentrating, and the recent acquisition of Cognis by BASF confirms this trend of convergence in
the industry. Key suppliers are trying to be present in most market segments to represent a one-stopshop for cosmetics and toiletries formulators. Press release from: Kline & Co Inc, Great Notch, 150 Clove Road, Little Falls, NJ 07424, USA, tel: +1 973 435 3443 or +1 973 808 3396, website: http://www.klinegroup.com (17 Aug 2010)
Report sees decline in I&I growth Growth in global demand for industrial and institutional (I&I) cleaning chemicals is anticipated to decline, primarily due to lower selling prices, according to Freedonia Group. The I&I market will expand 4.4%/y to 2013, down from 5.6%/y in 20032008. Sales are anticipated to amount to approximately $38 bn in 2013, compared to $30 bn in 2009. North America and Western Europe together will account for about 58% of the I&I market in 2013, down from more than 60% in 2008. The US will remain the largest single market over the forecast period. The I&I market in Asia/Pacific is anticipated to grow 6.6%/year to $10.2 bn. The shift towards higher-end formulations with reduced environmental impact will continue, although commodity cleaners will retain their presence. Chemical Week, 9 Aug 2010, (Website: http://www.chemweek.com)
COMPANY RESULTS Rhodia financial report half-year ended 30 Jun 2010: Novecare For its 1H 2010 (period ends 30 Jun 2010), the Novecare segment of Rhodia SA has reported net sales of €532 M (€417 M in 1H 2010) and operating profit of €72 M (operating loss of €10 M). The positive trend in net sales stems largely from the acquisition on 27 Feb 2009 of the US surfactant producer McIntyre [Focus on Surfactants, Apr 2009], whose products serve the cosmetics and detergents markets. In addition, the positive currency conversion impact of €8 M reflects the changes mainly arising from the appreciation of the
5
FOCUS Brazilian real and, to a lesser extent, the appreciation of the pound sterling and certain Asian currencies against the euro. On a constant consolidation scope and exchange rate basis, Novecare net sales improved by 20.4% in 1H 2010. The enterprise benefited from a turnaround in activity in all world regions. Recovery was quick and widespread in the industrial applications, agrochemicals and coatings markets, whereas it was gradual in the oil mining sector. Novecare volumes therefore increased 24.2% between the two reference periods, with particularly significant growth in 2Q 2010 – volumes were up 18% in 1Q 2010, and up 31% in 2Q 2010, when sales grew 30% in value terms to €287 M. Rising volumes generated a positive impact of €42 M on the segment’s operating profit. Effective pricing power enabled Novecare to record a favourable net impact (sale price/raw material costs) of €8 M for 1H 2010. The slight rise in fixed costs generated a negative €1 M impact that was fully offset by lower restructuring expenses, as last year reported important charges for the implementation of temporary and structural competitive measures. The net of these elements resulted in a positive €6 M variance between the two reference periods. The other items explaining the increase in Novecare’s operating profit include a positive consolidation scope impact of €3 M, a positive impact of €2 M relating to other operating income and expenses, a positive transactional exchange rate impact of €1 M and a positive impact of €1 M arising from the decline in depreciation, amortization and impairment. In Jun 2010, Rhodia announced its plans to acquire Feixiang Chemicals [ibid, Aug 2010], a company specializing in amines and surfactants located in Zhangjiagang near Shanghai (China). This acquisition, which should be finalized in 2H 2010, represents a unique opportunity for Rhodia to integrate speciality amine technologies into Novecare’s business portfolio. The combination of the group’s formulation expertise and end-market applications with Feixiang Chemicals’ amine technologies should reinforce Rhodia’s worldwide leadership position in speciality surfactants for the home and personal 6
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care, agrochemicals, oilfield and industrial markets, the company says. Rhodia Results 1H 2010, Jul 2010, 10-12 (Rhodia SA, Immeuble Coeur Defense, Tour A, 110 esplanade Charles de Gaulle, 92400 Courbevoie, France, tel: +33 1 5356 6464, fax: +33 1 5356 6459, website: http://www.rhodia.com)
Huntsman releases 2Q 2010 results Huntsman Corp reported revenues for 2Q 2010 of $2343 M, up 27% from $1846 M for 2Q 2009, and up 12% from 1Q 2010. Revenues increased due to higher sales volumes and higher selling prices in all divisions. Net income attributable to Huntsman for 2Q 2010 was $114 M ($406 M for 2Q 2009). For 2Q 2010, adjusted EBITDA was $257 M (EBITDA of $93 M for 2Q 2009). For 1H 2010 revenues were $4437 M ($3526 M) while the company reported a net loss of $56 M, compared to net income of $112 M in 1H 2009. For the Performance Products segment, which houses the company’s surfactants offerings, revenues were $669 M in 2Q 2010 ($482 M in 2Q 2009), and $1285 M in 1H 2010 ($982 M in 1H 2009). Year on year, average selling prices were up 12% for the second quarter with almost all product groups affected, primarily in response to higher raw material costs. Sales volume increased 27%, largely due to higher demand across all product groups and additional sales of ethylene glycol, which had previously been produced under tolling arrangements, the company reports. EBITDA for the segment was $116 M for the three months to the end of Jun 2010 compared to $31 M for the same period in 2009; and $176 M for 1H 2010 ($94 M in 1H 2009). Huntsman Corp results 2Q and 1H 2010, 5 Aug 2010, (Huntsman Corp, 3040, Post Oak Boulevard, Houston, TX 77056, USA, tel: +1 713 235 6000, fax: +1 713 235 6416, website: http://www.huntsman.com)
M (SFR 26 M), and EBIT of SFR 43 M (SFR 21 M). For its 1H 2010, this business unit has reported sales of SFR 746 M (SFR 672 M for its 1H 2009), EBITDA (before exceptional items) of SFR 116 M (SFR 40 M), EBIT (before exceptional items) of SFR 95 M (SFR 16 M), and EBIT of SFR 85 M (SFR 5 M). Sales in Performance Chemicals improved year on year as well as sequentially. Additives, Emulsions and Paper Specialties showed the strongest growth while Detergents & Intermediates grew at a more moderate pace. Emulsions experienced the highest pressure from rising raw material costs. The business unit was able to fully offset higher costs for acrylates and vinyl acetate monomers by higher sales prices. Detergents & Intermediates reported another good quarter with high capacity utilization. Clariant Results 2Q 2010, 29 Jul 2010, 9 (Clariant International Ltd, Rothaustrasse 61, CH-4132 Muttenz 1, Switzerland, website: http://www.clariant.com)
Bochemie Group reaches record sales in 1H 2010 Bochemie Group (BG) (Bohumin, Czech Republic), the manufacturer of Savo branded detergents and disinfectants, reached record sales worth CEK 570 M in 1H 2010, an increase of 10% compared to 1H 2009. In 1H 2010, BG’s sales increased most rapidly (by about tenfold to several tens of millions of CEK) in Romania, a market it entered in 2009. Sales are also increasing in Slovakia and Poland in 2010 thanks to BG’s significant marketing activities in these countries. Demand for Savo products is also increasing in the Czech Republic, with sales increasing 76% year on year in Jul 2010. Technicky Tydenik, 17 Aug 2010, 58 (16), 2 (in Czech) & Hospodarske Noviny, 10 Aug 2010, 54 (154), 18 (in Czech)
Clariant further improves profitability based on better demand and reduced cost base
Henkel defies industry trend and increases forecast
For its 2Q 2010, the Performance Chemicals business unit of Clariant International Ltd has reported sales of SFR 387 M (SFR 335 M for its 2Q 2009), EBITDA (before exceptional items) of SFR 64 M (SFR 38 M), EBIT (before exceptional items) of SFR 54
Henkel’s sales rose 11.6% in 2Q 2010 to €3.89 bn, with organic sales growth at 6.8%. 2Q EBIT was up 51.2% from €279 M to €421 M and net profits rose 90% from €143 M to €273 M. EBIT after adjusting for restructuring costs was up 54.5% at OCTOBER 2010