Royal DSM, the Life Sciences and Materials Sciences company, reported a third quarter EBITDA of €342 million compared to €270 million in Q3 2012. This improvement of 27% was realized despite an ongoing challenging macro-economic environment.
Highlights:
-DSM records 27% higher Q3 EBITDA compared to Q3 2012 (€342 million versus €270 million) - Life Sciences EBITDA up 23% from Q3 2012 - Materials Sciences EBITDA up 27% from Q3 2012 - Q3 cash flow from operating activities €310 million, higher than Q3 2012 - Core Earnings per Share Q3 2013 up 28% from Q3 2012 - Outlook full year 2013 unchanged
Commenting on the results, Feike Sijbesma, CEO/Chairman of the DSM Managing Board, said, “I am pleased to report increased profitability in all our business clusters despite the initial impact from adverse currency movements and a continued challenging macro-economic environment. Nutrition continued its good performance notwithstanding some headwinds that emerged towards the end of Q3. Materials Sciences also delivered solid performance with higher profits.
Our focus remains on the full integration of acquisitions and delivery of synergies, which together with continued success in our wide-ranging Profit Improvement Program will help improve DSM’s returns. Current trading conditions are similar to those experienced at the end of Q3, while foreign exchange rates deteriorated. Nevertheless, we are firmly on track to deliver a significant increase in EBITDA for the full year. The 2013 outlook given at our Capital Markets Day remains unchanged.”
Performance Materials
Organic sales growth was 4% compared to Q3 2012. Volumes increased in all three business groups, with DSM Dyneema delivering double-digit growth. Prices decreased at DSM Resins & Functional Materials, driven by the continued weak European economic climate and mix effects. Prices were stable at DSM Dyneema and DSM Engineering Plastics. Adverse currency movements, mainly in DSM Engineering Plastics, offset a significant part of the cluster’s organic growth.
EBITDA for Q3 was €84 million compared to €72 million in the same quarter of 2012. EBITDA margins continued to improve, reaching 12% in the quarter. DSM Dyneema saw its EBITDA improve significantly compared to 2012, driven by strong top-line growth. EBITDA of DSM Resins & Functional Materials showed an improvement due to strong cost control. DSM Engineering Plastics delivered a stable EBITDA performance, with negative currency effects compensated for by cost savings.
Polymer Intermediates
Organic sales development was in line with Q3 2012, with higher volumes fully offset by lower prices. Overall sales were lower due to currency effects.
EBITDA for the quarter was higher than in the same quarter of 2012, when there were negative effects from scheduled plant turnarounds in China and the USA. Cost savings and license income also contributed to the improvement in EBITDA.
