LANXESS clocks 31.3% decline in Q1 sales on low demand; expects improvement in Q2

Specialty chemicals group LANXESS AG (Germany) posted a net loss of EUR 14 mln for Q1 - 2009 against net income of EUR 104 mln for the prior-year period on a steep decline in demand led by economic downturn. The sales for the three month period clocked 31.3% year on year decline to EUR 1,054 mln. "All business units were impacted by the global recession," said Axel C. Heitmann, Chairman of the LANXESS Board of Management. "The drop in demand of more than 35 percent reached historic proportions. But by immediately launching our extensive 'Challenge09' package of global measures, we succeeded in achieving nearly one-third of the very high earnings level seen in the prior-year period." The company's Performance Polymers segment saw a 35.4% decline in sales and a 40% decline in volumes led by collapse of demand in all major customer industries, particularly the automotive sector. The sales of Performance Chemicals segment, which deals with industries including construction, furniture, automotives, etc. dropped 31.7 % year-on-year while the Advanced Intermediates segment sales were down 21.6 % year-on-year. "We anticipate a significant improvement compared to the first quarter, but of course earnings will still be below the second quarter of last year," said Heitmann.
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