Specialty Chemicals
- Volumes flat, despite significant global supply chain disruptions, including Hurricane Harvey
- Revenue up 1% due to positive price/mix effects, mostly offset by adverse currencies
- EBIT up 1% with favorable price/mix developments and cost savings, partly offset by adverse currencies and global supply chain disruptions
- ROS at 14.0% (2016: 14.0%); ROI at 17.9% (2016: 17.2%)
Expanding in Expancel
We are investing €20 million to boost production of Expancel, which can improve the properties of many everyday items, from running shoes to wine corks.
Volumes were flat despite significant global supply chain disruptions, including Hurricane Harvey. Excluding the impact of supply chain disruptions, volume growth would have been around 3%. China and Brazil continued to grow. Revenue was up 1%, due to positive price/mix effects, partly offset by adverse currencies. Positive price/mix reflects the successful pass through of raw material price inflation.
EBIT was up 1%, with favorable price/mix developments and cost savings mostly offset by adverse currencies and global supply chain disruptions. The EBIT impact from the supply chain disruptions was around €20 million.
Third quarter |
|
January-September |
||||||
2016 |
2017 |
∆% |
in € millions |
2016 |
2017 |
∆% |
||
|
||||||||
424 |
437 |
3 |
Functional Chemicals |
1,305 |
1,379 |
6 |
||
314 |
319 |
2 |
Industrial Chemicals |
906 |
938 |
4 |
||
262 |
252 |
(4) |
Surface Chemistry |
786 |
818 |
4 |
||
226 |
226 |
– |
Pulp and Performance Chemicals |
683 |
696 |
2 |
||
(24) |
(25) |
|
Other/intragroup eliminations |
(66) |
(74) |
|
||
1,202 |
1,209 |
1 |
Total |
3,614 |
3,757 |
4 |
||
|
|
|
|
|
|
|
||
168 |
169 |
1 |
EBIT |
511 |
524 |
3 |
||
168 |
169 |
1 |
Operating income |
511 |
524 |
3 |
||
14.0 |
14.0 |
|
ROS% * |
14.1 |
13.9 |
|
||
|
|
|
|
|
|
|
||
|
|
|
Average invested capital |
3,493 |
3,585 |
|
||
|
|
|
Moving average ROI (in %) * |
17.2 |
17.9 |
|
||
|
|
|
|
|
|
|
||
81 |
77 |
|
Capital expenditures |
228 |
241 |
|
||
|
|
|
Number of employees |
9,000 |
9,200 |
|
||
Revenue development Q3 2017
Functional Chemicals
Revenue was up 3% mainly due to improved price/mix, partly offset by adverse currency effects. Volumes were up 1% despite supply chain disruptions, including Hurricane Harvey. Volumes in Asia were also impacted by the industry-wide inspections in China driven by enforcement of environmental regulations. Underlying demand continued to be strong, mainly driven by the ethylene value chain and the contribution of our new organic peroxides facility in China.
Industrial Chemicals
Revenue was up 2% due to positive price/mix effects, partly offset by lower volumes caused by continued supply chain disruptions in the Rotterdam cluster. The global supply and demand balance for caustic continued to tighten, leading to strengthening caustic prices.
Surface Chemistry
Revenue was down 4%, driven by lower volumes, due to industry-wide supply chain disruptions as a result of Hurricane Harvey, and adverse currencies. The underlying demand was strong, with a continued recovery of the oil related segments.
Pulp and Performance Chemicals
Revenue for the quarter was flat. Positive volume developments, driven by strong demand for bleaching chemicals in Brazil and performance products, were offset by adverse currency effects and the planned ending of manufacturing agreements related to the divestment of the Paper Chemicals business in 2015.