Cognis Reports Record 1Q10

MONHEIM, GermanyCognis reported record first-quarter 2010 financial results that exceeded the first quarter of 2009. Sales increased by 10.6 percent to 728 million due to a strong recovery in actual demand, and supported by customer restocking. Sales volumes across all business units were up by 14.2 percent, and reached similar levels to the first quarter of 2008. This volume growth offset lower selling prices, and was at its strongest in March.

Europe in particular saw a remarkable recovery in demand, and Cognis sales in this region increased by 10.1 percent. Sales in Asia-Pacific were 29.8 percent higher than in the previous year, reflecting that this region remains on track for growth, as well as Central and South America, where sales grew by 4 percent. In North America, sales increased by 2 percent.

Nutrition & Health saw its sales increase by 5.2 percent to 88 million (up 3.9 percent on an organic basis) due to higher demand in the food, nutrition and pharma market segments. Sales in Asia-Pacific were significantly above previous years level across most of the product portfolio, as a result of increased sales volumes. Sales in Europe were also higher, driven primarily by strong demand from the food and pharma industries. Adjusted EBITDA rose by 29.5 percent to 19 million, reflecting both higher sales volumes and lower costs.

Cognis operating result of 131 million was the best in the companys history, representing an increase of 58 million (79.6 percent) on the previous year. Return on sales improved by 6.9 percentage points to 17.9 percent. This development was driven by higher sales volumes, better capacity utilization and the continuous shift of the portfolio toward high value specialties. In addition, the company benefited from the cost management activities initiated in 2008 and 2009.

All our business units and regions delivered very strong results in the first quarter of 2010. With our innovative products aligned with the wellness and sustainability trends we were extremely well positioned to benefit from improved business conditions. Our company has been able to deliver excellent performance due to our improved product mix, significantly higher capacity utilization and lower operating costs, said Cognis CEO Antonio Trius.