LANXESS makes confident start to fiscal year 2021

Lanxess is currently present in 33 countries with about 14,300 employees

Earlier, German specialty chemicals company proved robust in the 2020 fiscal year, posting EBITDA pre exceptionals of €862 million ($1.02 billion), only 15.4 per cent lower than the previous year’s figure of €1.019 billion ($1.22 billion), despite the pandemic.

On January 26, the group released the preliminary figures for a strong fourth quarter, after many businesses had developed better than expected. The EBITDA margin pre exceptionals reached an encouraging 14.1 per cent, against 15 per cent a year ago.

“We performed well in the pandemic year of 2020 and pulled off a strong finish in the fourth quarter. Our earnings margin shows that the group’s stable position is standing the test of the crisis,” said Matthias Zachert, chairman of the Board of Management of Lanxess AG. “With this team and our strong position, we can tackle 2021 with optimism and focus entirely on growth.”

The group’s sales in 2020 shed 10.3 per cent to €6.104 billion ($7.28 billion) from the previous year’s figure of €6.802 billion ($8.11 billion).

Its net income from continuing operations increased sharply to €908 million ($1.08 billion) compared to €240 million ($286 million) in the previous year. This was attributable to proceeds from the sale of its stake in chemical park operator Currenta, which Lanxess concluded at the end of April.

The net financial liabilities decreased from €1.742 billion ($2.08 billion) at the end of 2019 to €1.012 billion ($1.21 billion) as of December 31, 2020.

The dividend is also expected to be on the rise again for the exceptional year 2020. The Board of Management and Supervisory Board will propose a dividend of €1 per share ($1.19) – around 5 per cent more than in the previous year – to the Annual Stockholders’ Meeting, slated to be held virtually on May 19, 2021. This corresponds to a total payout of around €87 million ($103.7 million).

The company’s growth focus in 2021 are businesses with consumer protection products. Within a few weeks, Lanxess has announced three acquisitions in this area. With the acquisition of the French biocide specialist INTACE already completed, the specialty chemicals company has expanded its range of fungicides for paper and packaging. In the future, Lanxess will significantly expand its offering for the growing animal hygiene market with the portfolio of the disinfectant and hygiene provider Theseo. The transaction is expected to be completed in the second quarter this year.

In mid-February 2021, the specialty chemicals company announced the second-largest acquisition in its history. By acquiring the US group Emerald Kalama Chemical, Lanxess can further strengthen its consumer protection segment and tap into new fields of application with high margins such as the food industry and animal health.

The group expects the transaction to be completed in the second half of the year following regulatory approvals.

“Consumer protection products are characterised by attractive growth rates and strong margins. We want to grow in this area and have got down to it right from the very start of the year,” said Zachert.

Lanxess currently has about 14,300 employees in 33 countries. Its core business is the development, manufacturing, and marketing of chemical intermediates, additives, specialty chemicals, and plastics.