Cognis Reports First Quarter Results
Posted: May 28, 2008Cognis, an international specialty chemical and nutritional ingredients supplier, announced its first quarter 2008 fiscal results. Total external sales increased by 7.1% (€953 million) in the first three months of 2008, due to higher sales in three business areas—Cognis Care Chemicals, Nutrition & Health and Functional Products. On an organic basis, sales grew by 11.3%.
Specifically, Care Chemicals’ sales rose by 9.6% to €398 million, which can be attributed to higher demand and selling prices largely reflecting the increase in raw material prices. Care Chemicals’ organic sales rose by 12.3%. Nutrition & Health recorded a 5.8% rise (sales of €91 million) due to strong sales in its functional foods and dietary supplements markets, and its organic sales, specifically, increased by 7.8%. Cognis’ last core business segment, Functional Products, reported total sales of €229 million, an increase of 2.6%, which was affected by a slow-down in the housing and construction sector. However, Cognis reported good overall performance from the synthetic lubricants and agrochemical solutions segments, and Functional Foods’ organic sales increased by 9.9%.
Pulcra Chemicals, a wholly owned subsidiary of the Cognis Group, reported a decrease in sales by 9.6% to € 56 million due to lower demand for products from the leather and the textile industries. Pulcra Chemicals’ organic sales dropped by 7.3%. Whereas, Cognis Oleochemicals, the joint venture between Cognis and Sime Darby, recorded sales of €175 million, an increase of 16.5%, in part due to a higher selling price for fatty acids and glyercin, globally. Cognis Oleochemicals’ organic branch increased sales by 21.8%. Lastly, although focusing on wellness and sustainability, Cognis’ raw material and energy costs also increased due to what the company refers to as “unfavorable exchange rates.”
“Considering the challenging situation we have been facing, we achieved our expectations,” says Antonio Trius, Cognis’ CEO. “We performed well in the first quarter of 2008, with increased sales across all our core business areas. As 2008 continues, we expect the market environment to stay challenging, but we are well prepared. We are confident that further price increases and stringent cost management will support us to remain on track and to achieve our targets.”