The specialty chemicals group ALTANA continued on its growth course in the 2013 business year. Sales increased by 4% to €1,765 million in year-to-year terms. "With the acquisition of Rockwood's rheology business, in particular, we reached another important milestone on our path for profitable growth," stated Dr. Matthias L. Wolfgruber, CEO of ALTANA AG. "We want to consistently continue on our growth course in the future." Acquisitions contributed 3% to the growth in sales. Negative exchange rate effects curtailed growth by 2%. Adjusted for these effects, operating sales growth was 3%, particularly due to higher sales volumes.
Earnings before interest, taxes, depreciation and amortization (EBITDA) grew by 4% to €336 million. At 19%, the EBITDA margin remained unchanged at a high level. Due to increased financial expenses and depreciation and amortization from the acquisitions made in the year under review, earnings before taxes (EBT) amounted to €213 million and were slightly lower than in 2012.
Strong growth at BYK through rheology acquisition
The BYK Additives & Instruments division achieved the highest sales growth in 2013. Compared to the previous year, sales rose by 12% to €691 million. Just under half of the increase resulted from the integration of Rockwood's rheology activities, which is proceeding to plan. As of October 1, 2013, ALTANA acquired the rheology business of the U.S. American Rockwood Group, thereby considerably strengthening BYK's position in this product area. Positive sales effects were also provided by the acquisition of the wax additives business in the U.S. at the end of 2012. Adjusted for acquisition and exchange rate effects, operating sales rose by 7%.
The ECKART Effect Pigments division generated sales of €335 million in 2013. The slight decrease of 2% compared to the previous year primarily resulted from exchange rate changes. ECKART managed to keep its operating sales at the previous year's level.
Sales in the ELANTAS Electrical Insulation division rose by 1% to €415 million in the 2013 business year. Adjusted for negative exchange rate effects, sales rose by 3%, primarily driven by higher sales volumes.
Sales in the ACTEGA Coatings & Sealants division fell by 3% to €325 million. Slightly positive effects from acquisitions almost equaled burdens from exchange rate changes. As a result, operating sales also decreased by 3%.
Asia and the Americas continue to grow; economic recovery in Europe
In terms of regions, ALTANA achieved the highest growth rates in 2013 in Asia. This development was primarily driven by increased demand in China, where sales rose by 14%. Sales in the entire Asian region rose by 7%. The company's sales performance in the Americas was positively influenced by company acquisitions. In North and South America ALTANA achieved total sales growth of 6%. Sales in the core region Europe and ALTANA's domestic market Germany were down by 1% respectively. In the course of the year, however, demand steadily increased in many European countries, and in the last quarter of the 2013 business year operating sales increased compared to the same period of the previous year.
Significant investments in innovation and production
In 2013, ALTANA's research and development expenses rose by 7% to €109 million. As a result, the share of sales invested in R&D grew to 6.2% and was once again higher than in the previous year (6.0%). ALTANA invested €94 million in property, plant and equipment and intangible assets. One of the investment priorities was the expansion of U.S. production capacities in the BYK division.
Outlook: Further sales growth in 2014, doubling of business by 2020
ALTANA anticipates the general economic climate to improve slightly in 2014. This development should be driven, in particular, by the recovery of the European markets. Against this backdrop, the Group expects sales growth, adjusted for acquisition and exchange rate effects, in the low to medium single-digit percentage range. As the rheology activities acquired of Rockwood and the acquisitions implemented by the ACTEGA division will be consolidated for the first time for a whole year, ALTANA anticipates an increase in sales in the high single-digit percentage range for the current business year. The company's return on sales is expected to be similar to that of 2013.
For the future, too, ALTANA has set itself ambitious goals. "We seek to double our business by 2020," said ALTANA CEO Wolfgruber. "This growth should be reflected not only by sales growth to €3.5 billion, but also by new jobs. We have proven that we are able to achieve sustainable growth rates of this magnitude." Since ALTANA AG was founded in 1977, the company has increased its sales in the field of innovative specialty chemicals from €24 million to more than 70 times that amount and its workforce has grown from 259 to 5,741 as of the 2013 balance sheet date.