Speciality chemicals producer Clariant (Muttenz / Switzerland; www.clariant.com) has reported operating profit (EBITDA) of CHF 214m (EUR 176m) in the second quarter of 2014, up from CHF 211m in Q2 2013. However, in local currencies, EBITDA increased by 9% year-on-year in the quarter. Operating margin in the period rose to 14% from 13.7% in the second quarter of 2013, thanks to higher gross margin and reduced selling, general and administrative costs, which more than compensated for a 1.5% point negative impact from exchange rate developments, the company said.

Sales in the quarter were CHF 1.53 bn, compared to CHF 1.54 bn in Q2 2013, but grew by 6% year-on-year in local currencies. Unfavourable development of the US dollar and Japanese yen, and emerging market currencies including the Brazilian real and Indian rupee, translated into the 1% reduction in sales in Swiss francs.

Hariolf Kottmann, Clariant CEO, said: “The first half-year 2014 was characterised by a more favourable but still volatile and challenging business environment compared to the previous year. Under these conditions, Clariant achieved good volume growth in both the first and the second quarter, supported by solid pricing. With unfavourable currency developments expected to soften, the strength of our portfolio makes us cautiously optimistic going into the second half of the year.”

In the second quarter of 2014, EBITDA margin before exceptional items in the plastics and coatings business area of 14.0% was lower than the second quarter of 2013, as higher volumes could not compensate for unfavourable currency developments. Sales in the business increased 6% in local currencies and were flat in Swiss francs compared to Q2 2013.

All three businesses in the plastics and coatings area – pigments, masterbatches, and additives – contributed to growth, the company said. Pigments achieved strong sales gains in local currencies in most regions, with particularly strong demand in Asia/Pacific, Latin America, and North America. Masterbatches experienced good sales growth in local currencies, thanks to strong demand in emerging markets, while sales in mature markets decreased. Additives achieved strong sales growth in flame retardants and polymer additives, while waxes grew moderately, Clariant said, with growth in local currencies highest in North America and Europe.

In the catalysis and energy business area, EBITDA margin increased to 28.2% in the second quarter of 2014 from 25.9% in the second quarter of 2013, due to a lower production cost base. Second quarter sales increased 5% in local currencies and declined 1% in Swiss francs. All regions contributed to growth with the exception of Europe, which had recorded a strong second quarter in 2013. There was particularly good sales growth in the Middle East, an improvement on the trough levels seen in 2013.

Clariant added that its Ziegler-Natta PP catalyst production plant in Louisville, Kentucky / USA is on schedule to begin production in 2015. The plant is part of a long-term strategic partnership between the company’s catalysts unit and the Lummus Novolen Technology (Mannheim / Germany; www.novolentechnology.com) business of Netherlands-based energy infrastructure company CB&I (www.cbi.com) – see Plasteurope.com of 28.08.2013.

Looking forward, Clariant said it expects the business environment to remain challenging with mixed global economic developments and volatile currency markets. The general economic environment in the emerging markets is expected to remain varied but overall favourable, while moderate growth should continue in the advanced economies, in particular in the US.