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Tuesday 31 July, 2018

Solvay S.A.

Solvay 2018 first half results: Strong volume growth counters forex headwinds

Solvay 2018 first half results: Strong volume growth counters forex headwinds
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Details to connect to the 2:30pm analysts & investors call
Underlying EBITDA: €1,150 million -3% (+6% organically [1])
  • Solid volume increase across Advanced Materials and Advanced Formulations led to organic sales and EBITDA growth of 6%
  • Underlying EBITDA fell 3%, mainly due to significant  forex conversion impact of 7%, principally as a result of the US dollar
  • EBITDA margin remained at a record 23%
  • Advanced Materials: €630 million -3% (+5% organically [1])
    • Sustained demand for high-performance polymers across applications, particularly in automotive, led to strong volume growth
    • Increased demand for aerospace composites, including commercial, rotorcraft and military, supported solid volume growth
  • Advanced Formulations: €262 million +2% (+17% organically [1])
    • Volume growth was strong across end-markets and especially in the North American oil & gas market
    • Pricing power more than compensating for higher raw material price
  • Performance Chemicals: €365 million -9% (-3% organically [1])
    • Solid demand for soda ash continued in a context of limited margin erosion
    • Peroxides volume and price increased on solid demand
Underlying EPS from continuing operations: €4.65 +9%
  • The €43 million reduction of net financial charges, a 21% drop, reflects the deleveraging and optimization of Solvay's capital structure
  • The tax rate of 25% was down from 29% in 2017

Free cash flow from continuing operations: €123 million vs €251 million in 2017
  • Sustained cash generation led to €218 million of free cash flow, including €123 million from continuing operations, but this was lower than in 2017 due to working capital fluctuations
  • Free cash flow to Solvay shareholders increased to €77 million from €33 million in 2017, thanks to the strong contribution from discontinued operations and lower financial payments
2018 outlook confirmed
  • EBITDA growth of 5% to 7%, excluding scope and forex effects
  • Free cash flow from continuing operations above the 2017 level
CEO Jean-Pierre Clamadieu: Solvay's sales and EBITDA grew 6% organically in the first half of 2018 driven again by volume growth from our growth segments. Advanced Formulations benefited in particular from the continued rise in activity of North American shale oil & gas, while Advanced Materials growth was supported by automotive and aerospace. These strong results are a clear manifestation of the portfolio transformation of the past years. Internally, we are now focused on putting in place a simpler and more agile organization to better serve our customers.
All comparisons are made with the equivalent period of the year before, except where mentioned explicitly otherwise.
[1] Excluding forex conversion and scope effects


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Solvay is an advanced materials and specialty chemicals company, committed to developing chemistry that addresses key societal challenges. Solvay innovates and partners with customers worldwide in many diverse end markets. Its products are used in planes, cars, batteries, smart and medical devices, as well as in mineral and oil and gas extraction, enhancing efficiency and sustainability. Its lightweighting materials promote cleaner mobility, its formulations optimize the use of resources and its performance chemicals improve air and water quality. Solvay is headquartered in Brussels with around 26,800 employees in 61 countries. Net sales were €10.1 billion in 2017, with 90% from activities where Solvay ranks among the world's top 3 leaders, resulting in an EBITDA margin of 22%. Solvay SA (SOLB.BE) is listed on Euronext Brussels and Paris (Bloomberg: SOLB.BB - Reuters: SOLB.BR) and in the United States its shares (SOLVY) are traded through a level-1 ADR program.  

Financial figures take into account the planned divestment of Polyamides.

Media Relations
 Caroline JacobsAmandine Grison  
  +32 2 264 1530 +33 1 40 75 81 49
Investor Relations
[email protected]Geoffroy RaskinJodi AllenBisser Alexandrov
+32 2 264 2158  +32 2 264 1540 +1 6098604608 +32 2 264 3687

This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Solvay S.A. via Globenewswire

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