Lanxess sales drop; realignment on horizon

Chris Sweeney
RUBBER & PLASTICS NEWS

Published: May 9, 2014 11:40 am ET
Updated: May 9, 2014 11:50 am ET

Image By: Lanxess AG Lanxess CEO Matthias Zachert

Related to this story

Topics Materials, Materials Suppliers

Lanxess AG reported a 2.5 percent decrease in sales for the first quarter of 2014 and net income that held steady compared to 2013.

The Cologne, Germany-based firm's sales came in at about $2.78 billion, with its net income about $34.8 million.

CEO Matthias Zachert said Lanxess is developing measures to realign itself, which will include streamlining its decision-making process and optimizing administrative structures.

“We must become significantly more competitive and profitable again,” Zachert said. “The focus will therefore be on the business portfolio, our business units, the efficiency of our administration and our production sites.”

Lanxess said the personnel adjustments initiated last year as part of its advance efficiency program have been completed in line with expectations.

The program included savings of $135.3 million by 2015 and beyond by eliminating 1,000 jobs worldwide. Lanxess said in an earlier release that approximately 730 employees have accepted voluntary layoffs by the end of 2015, accepting either early retirement or severance packages. Approximately $151.5 million of the estimated $206.5 million in exceptional charges budgeted for the program were incurred in 2013.

The firm said the encouraging increase in volumes throughout all business segments did not offset the drop in selling prices and negative currency effects.

“The first quarter was characterized by a persistently challenging market environment for synthetic rubber,” Zachert said. “The agrochemicals business, however, continued to develop well. Positive impetus also came from the construction industry.”

Sales in the performance polymers segment declined by 6.3 percent, to about $1.53 million. Its advanced intermediates segment’s sales dropped 3.2 percent to about $583 million. Lanxess’ performance chemicals segment’s sales increased by 5.8 percent to about $765.3 million.

Lanxess said it anticipates the economic environment will continue to recover slowly during the remainder of the year, but it said it believes the challenging competitive environment for its synthetic rubber businesses will continue because of persisting price pressure.

Lanxess is a special chemicals producer that reported sales of about $11.5 billion in 2013 and operates 52 production sites worldwide. It employs about 17,000 in 31 countries.


Comments

Lanxess sales drop; realignment on horizon

Chris Sweeney
RUBBER & PLASTICS NEWS

Published: May 9, 2014 11:40 am ET
Updated: May 9, 2014 11:50 am ET

Post Your Comments


Back to story


More stories

Image

EPA fines RI polymer company

August 29, 2014 1:20 pm ET

A Rhode Island polymer manufacturer has reached a $60,000 settlement with the U.S. Environmental Protection Agency (EPA) for violating federal clean...    More

Image

Chinese compounders seek market shares, often at the expense of margins

August 29, 2014 10:02 am ET

China's largest compounder, Kingfa Sci. & Tech. Co. Ltd., as well as its more automotive-focused counterparts Shanghai Pret Composites Co. Ltd. and...    More

Image

PP prices rise 5 cents

August 28, 2014 3:59 pm ET

After a one-month break, volatility has returned to the North American polypropylene resin market, with prices increasing by an average of 5 cents...    More

Image

DuPont fined for 2010 chemicals release

August 28, 2014 1:37 pm ET

DuPont Co. has been fined almost $1.3 million for the release of several chemicals — including plastics feedstock phosgene — at its plant ...    More

Image

LyondellBasell to build feedstock plant on Gulf Coast

August 28, 2014 11:05 am ET

LyondellBasell Industries will build a world scale propylene oxide plant on the U.S. Gulf Coast with a capacity of 900,000 metric tons per year.    More

Market Reports

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report analyzes economic and market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as growth strategies being implemented by thermoformed packaging companies.

Learn more

Pipe, Profile & Tubing Extrusion in North America 2014

U.S. demand for extruded plastics is expected to grow by 3 percent in 2014, with PVC remaining the largest segment.

Plastic pipe will post the strongest gains through 2018, continuing to take market share from competing materials in a range of markets.

Our latest market report provides in-depth analysis of current trends and their financial impact on the pipe, profile and tubing extrusion industry in North America.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events