Business News
ALTANA AG reports excellent business year 2007
Tuesday 29. April 2008 - Dynamic growth in sales and earnings Dividend proposal: 0.25 per share Special dividend: 0.26 per share Positive outlook for the business year 2008
In the past business year, the specialty chemicals group ALTANA (ALT) achieved dynamic sales growth and disproportionate increases in earnings. “Our business performance in the first year as a pure specialty chemicals company was excellent and we were able to surpass our own ambitious targets,” stated Dr. Matthias L. Wolfgruber, CEO of ALTANA AG, at the companys press conference. “We are very confident to be able to continue our dynamic and profitable growth in 2008.”
Strong growth in sales and earnings
In the past business year, ALTANA achieved sales of 1,380.4 million, which is an increase of about 7% on 2006. Adjusted for negative exchange rate effects of 3% as well as minor positive acquisition and divestment effects, operating sales growth was 9%. With a sales growth of 11% the Asian region posted the strongest growth, followed by Europe with a growth of 8%. About half of ALTANAs sales, namely 678.0 million, were generated in Europe. Sales in Asia amounted to 329.7 million, with 149.8 million attributable to China. At 330.6 million, sales in North and South America remained almost unchanged.
At 248.5 million, ALTANAs earnings before interest, taxes, depreciation and amortization (EBITDA) rose disproportionately to sales. This corresponds to an increase of 33% or 62.3 million on the prior year. The EBITDA margin climbed from 14.4% to 18.0%, and was thus within the medium-term target corridor of 18% to 20% despite additional costs due to the two-tier holding structure which was maintained until mid-2007. All divisions were able to expand their EBITDA margins. The operating income (EBIT) totaled 166.6 million, and thus increased by 68% as compared to the business year 2006. Income before taxes (EBT) amounted to 214.3 million, up from 93.2 million in the prior year. The 2007 figure includes an income of 55 million from the investment of the proceeds related to the sale of ALTANA Pharma until the distribution to ALTANAs shareholders in May 2007. Net income (EAT) of the continued operations amounted to 138.4 million, and therefore more than doubled compared to the prior year.
As of December 31, 2007, the ALTANA Group employed 4,646 people, compared to 4,484 in the prior year. Investments in property, plant and equipment as well as intangible assets totaled 91.4 million. Group-wide research and development expenses reached 4.9% of sales, whereas the industry average is about 2% to 3%. Approximately 16% of ALTANAs staff worldwide are employed in the area of R&D.
Positive development in all divisions
The BYK Additives & Instruments division achieved sales of 445.1 million, up from 409.1 million in the prior year. This translates as an increase of 9%. Earnings before interest, taxes, depreciation and amortization (EBITDA) rose disproportionately to sales by 13%, up from 117.8 million to 132.6 million. The EBITDA margin was 29.8% (prior year: 28.8%).
ECKART Effect Pigments posted an increase of 7%, with sales rising from 338.8 million to 362.9 million. The EBITDA grew disproportionately by 19 % to 79.7 million (prior year: 67.2 million). The EBITDA margin was 22.0% compared to 19.8% in the prior year.
Sales of ELANTAS Electrical Insulation grew by 8% to 350.8 million (prior year: 325.7 million). The EBITDA grew disproportionately by 20% to 53.1 million. This resulted in an EBITDA margin of 15.1% compared to 13.6% in 2006.
Sales in the ACTEGA Coatings & Sealants division were up from 220.7 million to 221.6 million in the past business year. The increase in earnings was much more dynamic: The EBITDA climbed by 13%, rising from 23.5 million in 2006 to 26.7 million in 2007. The EBITDA margin rose accordingly from 10.7% to 12.0%.
Shareholders benefit from positive business development
ALTANA will enable its shareholders to participate appropriately in the companys success. Based on the excellent business year 2007, the Supervisory and Management Boards will propose to the Annual General Meeting on May 5, 2008, to distribute a regular dividend of 0.25 per share for the past business year. This corresponds to a distribution rate of around 33% measured in terms of the EAT of the continued operations, adjusted for the income (net of tax) from the investment of the proceeds related to the sale of ALTANA Pharma (35 million). This will be distributed to the shareholders as a special dividend in the amount of 0.26 per share. Provided the dividend proposal is approved, a total of 69.4 million or 0.51 per share will be distributed.
Positive outlook for 2008
For the current business year, ALTANA expects continued positive demand for specialty chemicals products. However, the demand growth should be slower compared to 2007. Raw materials prices should remain at their current high level. On this basis, we expect from todays perspective for 2008 a mid-range single-digit organic growth in sales to a level between 1.440 billion and 1.490 billion and an EBITDA growth to a level between 260 million and 290 million. These expectations are based on a presumed U.S. Dollar rate of 1.45 per Euro on an annual average.
The medium-range growth target is set at an average sales growth of about 10% annually (thereof about 6% organic growth) while maintaining an above-average profitability with an EBITDA margin of 18% to 20%.
ALTANA Group1
2007
2006
Change
in %
Sales – total (in million)
1,380.4
1,294.3
7
Sales by division (in million)
Additives & Instruments
445.1
409.1
9
Effect Pigments
362.9
338.8
7
Electrical Insulation
350.8
325.7
8
Coatings & Sealants
221.6
220.7
0
Sales by region (in million)
Europe
678.0
627.4
8
thereof Germany
239.6
223.2
7
North and South America
330.6
330.5
0
thereof U.S.
222.5
242.6
– 8
Asia
329.7
297.3
11
thereof China
149.8
127.5
18
Other regions
42.1
39.1
8
EBITDA (in million)
248.5
186.2
33
EBIT (in million)
166.6
99.4
68
EBT (in million)
214.3
93.2
> 100
EAT (in million)
138.4
56.8
> 100
Headcount (Dec. 31)
(fortzuführende Bereiche)
BYK Additives & Instruments
1,140
1,052
8
ECKART Effect Pigments
1,893
1,802
5
ELANTAS Electrical Insulation
887
883
0
ACTEGA Coatings & Sealants
670
655
2
Holding
56
92
– 39
ALTANA total
4,646
4,484
4
1) The figures relate to the continuing operations.
The Management Board will report in detail on ALTANAs annual financial statements at the press conference today at 11 a.m. (local time, CET) and at the analyst meeting at 2 p.m. (local time, CET). The meetings will take place at the Düsseldorf Hilton Hotel. Both meetings will be webcasted at www.altana.com.
Date:
The Annual General Meeting of ALTANA AG will take place on May 5, 2008, at the Congress Center Messe Frankfurt.
This press release contains forward-looking statements, i.e. current estimates or expectations of future events or future results. These statements are based on beliefs of ALTANA as well as assumptions made by and information currently available to ALTANA. Forward-looking statements speak only as of the date they are made. ALTANA does not intend, and does not assume any obligation, to update forward-looking statements to reflect facts, circumstances or events that have occurred or changed after such statements have been made.