Clariant hails leather division improvement
04/11/2009
Specialist chemical company Clariant has announced its results for the third quarter of 2009. The company said it had managed to improve operating profitability and cash flow in spite of ongoing weak demand.
Sales for the quarter were down by 14% in local currency and by 19% in Swiss Francs (CHF) compared to the same period last year. Operating income before exceptional items decreased to CHF 107 million from CHF 178 million in the third quarter of 2008, but improved from CHF 69 million in the second quarter of 2009.
Clariant said its cash flow was stronger now than a year ago as a result of what it called "ongoing stringent net working capital management".
Chief executive, Hariolf Kottmann, commented: “The focus on improving cash flow, decreasing costs and reducing complexity continued to have a positive impact on our results. Sales declines of more than 20% in some businesses indicate that despite a stabilisation in demand we are still far from a sustainable recovery. In this environment, our cost savings have not yet been sufficient to fully compensate for the demand weakness. As we need to close the performance gap to our peers and as we don’t see a sustainable recovery in our industry in the next quarters, we will continue to implement additional restructuring and cost saving measures.”
However, the company also said that its stringent focus on restructuring as well as a slight recovery in demand had led to an improved profitability of its Textiles, Leather & Paper Chemicals Division. It confirmed that leather was one of the industries in which demand had picked up.
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