Lanxess is starting the new fiscal year 2021 with confidence: The specialty chemicals company expects that many of its customer industries will recover and therefore anticipates EBITDA pre exceptionals of between 900 million and 1 billion Euros for the full year.
Lanxess proved robust in fiscal year 2020, which was dominated by the coronavirus pandemic. The specialty chemicals company achieved EBITDA pre exceptionals of EUR 862 million Euros, only 15.4 % lower than the previous year’s figure of 1.019 billion Euros. Earnings are therefore at the top end of the guided range of between 820 million and 880 million Euros. On January 26, the Group released preliminary figures for the strong fourth quarter, after many businesses had developed better than expected. The EBITDA margin pre exceptionals reached an encouraging 14.1 %, against 15.0 % a year ago.
“We performed well in the pandemic year of 2020 and pulled off a strong finish in the fourth quarter. Our earnings margin shows that the Group’s stable position is standing the test of the crisis,” said Matthias Zachert, Chairman of the Board of Management of Lanxess AG. “With this team and our strong position, we can tackle 2021 with optimism and focus entirely on growth.”
With the sales of the membrane and chrome chemicals businesses and the announced sale of the leather chemicals business, in 2020 Lanxess systematically divested areas that no longer fit into the strategic focus on specialty chemicals. The Group thus laid the foundation for more profitable development. The sale of its stake in the chemical park operator Currenta also provided a solid financial base.
Focus on businesses with consumer protection products
In 2021, all signs are pointing to growth – with a focus on businesses with consumer protection products. Within a few weeks, Lanxess has announced three acquisitions in this area. With the acquisition of the French biocide specialist Intace already completed, the specialty chemicals company has expanded its range of fungicides for paper and packaging. In the future, Lanxess will expand its offering for the growing animal hygiene market with the portfolio of the disinfectant and hygiene provider Theseo. The transaction is expected to be completed in the second quarter of 2021.
In mid-February 2021, the specialty chemicals company announced the second-largest acquisition in its history. By acquiring the U.S. group Emerald Kalama Chemical, the Consumer Protection segment can further be strengthened and new fields of application with high margins such as the food industry and animal health can be tapped into. The Group expects the transaction to be completed in the second half of the year following regulatory approvals.
The businesses in the Consumer Protection segment, newly created in 2020, performed strongly throughout the year. This was driven by strong agrochemicals business at Saltigo and good demand for disinfectants. The positive portfolio effect from the acquisition of the Brazilian biocide manufacturer Ipel also more than offset adverse exchange rate effects. Sales amounted to 1.110 billion Euros, up 5.7 % on the previous year’s figure. EBITDA pre exceptionals grew by 17.7 % to 233 million Euros.