Issue Date: August 7, 2006
Thanks to good economic conditions in much of the world, the European chemical industry performed buoyantly in the second quarter.
The earnings improvement was led by Akzo Nobel, where net earnings nearly doubled those of second-quarter 2005. Akzo Nobel executives attributed the surge primarily to improved operational earnings, led by its human health, coatings, and chemicals businesses.
The quarter was particularly satisfying for Rhodia, which turned in a profit of $115 million from continuing operations. That was a dramatic turnaround from the net loss of $123 million the company showed in the comparable period of 2005. Rhodia revealed that it has reclassified its European industrial fibers unit as a discontinued operation.
Sales growth among European firms was led by Kemira. According to the company, nearly $110 million of its sales increase was the result of acquisitions, including the purchase of Lanxess' paper chemicals business in early April.
Similarly, acquisitions accounted for 2% of the increase in BASF's sales, the rest coming from improved volumes and sales prices. In the quarter, the company added Engelhard and Degussa's construction chemicals business. Chairman J??rgen Hambrecht said he was "pleased to present new records for the second quarter and first half of 2006."
Meanwhile, cost savings of more than $100 million at Clariant could not counter the company's increased raw materials and energy costs, said CEO Jan Secher.
Following the sale of its pharmaceutical fine chemicals business this summer, Clariant is now considering the sale of its specialty fine chemicals business, which is experiencing "very difficult market conditions."
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