The specialty chemicals group LANXESS posted a significant decline in sales and operating profit in the second quarter due to weak global demand in many customer industries, but slightly exceeded market expectations.
The MDAX group LANXESS had already warned of the weak figures in June and lowered the forecast. LANXESS has now responded with an action plan to cut costs and become more efficient.
“The chemical industry and LANXESS are currently in troubled waters. The hoped-for recovery in demand for the second half of the year is currently not foreseeable. We are therefore taking countermeasures,” said CEO Matthias Zachert.
Sales fell by 11.1 percent to 1.78 billion euros in the period from April to June. LANXESS announced in June that demand was generally very weak and customers were continuing to run down inventories in the first quarter. Earnings before interest, taxes, depreciation and amortization (EBITDA) before special items collapsed by 57.7 percent to 107 million euros.
Analysts had expected a consensus of sales of 1.72 billion and EBITDA before special items of 103 million euros.
With the action plan “FORWARD!” LANXESS will initially make one-time savings of around EUR 100 million in the current year through cost reductions and reduced investments. In addition, the group is making itself more efficient and wants to permanently reduce its annual costs by around 150 million from 2025.
For 2023 as a whole, LANXESS is still targeting EBITDA before special items of between EUR 600 million and EUR 650 million.
CFO Pontzen leaves LANXESS – successor already found
The long-standing CFO of LANXESS, Michael Pontzen, is surprisingly leaving the chemical company at the end of August. The MDAX group announced on Friday in Cologne that the supervisory board had approved Pontzen’s request to end his appointment as chief financial officer early and to take on a new role as chief financial officer of a company outside of Germany. Oliver Stratmann will be his successor with effect from September 1st. According to the information, Oliver Stratmann has been working for the Cologne-based company since 2004 and has held various management positions in the financial organization. He has headed the Treasury & Investor Relations department since 2015. Via XETRA, the LANXESS shares temporarily lost 2.09 percent to EUR 28.55.
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