Cognis gets back in shape post recession hit

25-Nov-2010 - Last updated on 25-Nov-2010 at 12:27 GMT

Cognis is anticipating record results in full year 2010, as higher demand, better capacity utilisation and a portfolio shift towards high-value products has delivered a bumper set of results for the first nine months.

Currently owned by private equity funds advised by Permira, GS Capital Partners and SV Life Sciences, Cognis is in the process of being acquired by BASF for some €13.1bn. An agreement was reached in July subject to regulatory approval.

Today’s announcement indicates that Cognis is in better shape than it was in the depths of the economic downturn, as it has reported an 18.2 per cent increase in sales to €2315m in the nine months up to end September across its three divisions – nutrition and health, care chemicals, and functional products.

Adjusted EBITDA up almost 60 per cent to €423m.

The improvement looks to be due to a combination of recovery and strategic measures: “These excellent results were largely related to higher sales volumes due to an increased demand, a further shift in the product portfolio towards high-value specialties as well as better capacity utilization”.

In his commentary on the results, CEO Anthonio Trius drew particular attention to how is company’s portfolio is in keeping with wellness and sustainability trends.

“Due to the excellent performance of the first nine months of 2010, we expect to achieve a record full-year result,” he said.

Nutrition and health

The nutrition and health division saw sales increase by 7.1 per cent to €265m , which the company says reflects “higher demand in all market segments”. EBITDA for the division was up 36 per cent to €52m.

Cognis noted that efficiency gains in this division were particularly boosted by the April 2009 acquisition of phytosterol producer Phyto-Source, based in Pasadena, Texas, in the United States.