The company operates eight of its 80 production sites worldwide there. The Muttenzers are fighting rising energy and raw material costs with aggressive price increases.
As a result, for the months from July to September, the Group reported an increase in sales of 27% (in local currencies) at CHF 1.31 billion. The increase in selling prices contributed the lion’s share by 18 percentage points.
“Our customers have accepted price increases, which we owe to our specialty portfolio,” CEO Konrad Keijzer said Thursday on the conference call. And at least when it comes to raw material costs and logistics, the worst should be over for now.
The peak of inflation has passed
“There is a cascading decline – the peak of inflation is probably behind us,” said the Clariant chief. For example, propylene and ethylene prices fell for the first time in a long time in the third quarter. Of course, they will still be much higher than the previous year’s level.
According to Keijzer, with higher prices, Clariant was able to fully offset the increase in raw material costs as well as higher energy and logistics costs. There were also cost savings which were reflected in profitability.
EBITDA increased 29% to CHF 220 million in the third quarter. The corresponding margin rose 1.3 percentage points to 16.8 percent. Analysts were expecting lower values, above all on the profit side.
upcoming restructuring costs
For the full year, Clariant now expects sales of CHF 5.1 billion. This is slightly more than the 5.0 billion promised last time.
However, Clariant will still face significant burdens in the final quarter. The sale of the North American ground oil business would result in an impairment of approximately CHF 245 million. “It wasn’t a very profitable business,” said the Clariant boss.
In addition, there are restructuring costs in an amount that has not yet been disclosed. These arise with the new corporate structure – Clariant will remove the various levels of management. According to Keijzer, the costs of doing so would be “extremely significant”.
More details will only be available with the annual figures. “We first want to have conversations with the affected employees,” said the CEO.
Don’t worry about the lack of gas
Keijzer is relatively relaxed about the “gas situation” in Germany, where the company operates eight of the 80 global production sites. He said he did not think there would be gas rationing.
Should the issue still arise, Clariant is prepared. The Risk Reduction Plan has been implemented and is in effect. The basic plan is to switch from gas to lighter oil.
The prospect of higher write-offs was not well received by the stock exchange: in morning trade, shares were down 2.3 percent.
Clariant expects a significant reduction in carbon dioxide emissions in 2022
Clariant reduced its greenhouse gas emissions in the first nine months of the year. The specialty chemicals group justifies this with greater energy efficiency and a higher percentage of renewable energies.
According to a statement released Thursday, the company assumes that gas emissions will be “significantly” below the level of the previous year. Clariant didn’t mention specific numbers in the announcement. In 2021, the group emitted 710,000 tons of CO2 during operations (Scope 1 and 2).
The specialty chemicals group wants to reduce operational greenhouse gas emissions by 40 percent by 2030. The group aims for a reduction of 14 percent along the upstream and downstream value chain (Scope 3).
In the Swiss business, Clariant shares finally fell 3.28% to CHF16.80.