Perstorp Holding AB (Publ.) parent company for Perstorp today announced its interim report for Q2 2020 whereby the net sales decreased by 32% and stood at SEK 2,079 m. Excluding currency effects, sales prices in the second quarter were substantially lower than the corresponding quarter last year in EMEA and APAC, mainly linked to lower raw material prices.

 

Organic volume-based sales growth was -22% year-on-year. EBITDA excluding non-recurring items amounted to SEK 265 m. EBITDA-margin excluding non-recurring items was 12.7%.

 

“The second quarter was characterized by a clear slowdown of demand. Although EBITDA decreased by 27% during the quarter, Perstorp has demonstrated its ability to act with agility, defending margins and swiftly implementing programs for fixed cost reductions and cash preservation. Our available funds increased during the quarter by SEK 290 m and amounted to SEK 1,234 m at June 30", says Jan Secher, Perstorp President & CEO.

 

For Perstorp, the second quarter was characterized by a clear slowdown of demand, however with a great deal of variation between sectors and geographies. The largest volume loss took place in the Americas. We also experienced a drop of volumes in Europe, although at a somewhat lower rate, while there were some signs of recovery in APAC. Net sales amounted to SEK 2,079 m, a 32% decrease over the second quarter last year. This was mainly due to lower volumes driven by the Covid-19 situation driving country and industry lockdowns in all three geographies; Europe, APAC and Americas. Volume based sales growth for the period was -22% compared to the same period last year.

 

EBITDA excluding non-recurring items amounted to SEK 265 m (365) with an EBITDA margin of 12.7% (11.9). LTM EBITDA amounted to SEK 1,400 m compared to 1,554 m for the full year 2019. Although EBITDA decreased by 27% during the quarter, Perstorp has demonstrated its ability to act with agility, defending margins and swiftly implementing programs for fixed cost reductions and cash preservation. Our available funds increased during the quarter by SEK 290 m and amounted to SEK 1,234 m at June 30. 

 

The decrease in demand has primarily been seen in two of the three Business Areas.

 

Business Area Specialty Polyols & Solutions was primarily affected by lower volumes partly offset by improved unit margins for most product lines and a favorable product mix. EBITDA for the second quarter amounted to SEK 131 m (218).

 

Business Area Advanced Chemicals experienced lower volumes and lower unit margins for some of the product lines due to price pressure. EBITDA amounted to SEK 61 m (165). 

 

Business Area Animal Nutrition continued to show a positive volume development, but was impacted by lower unit margins and higher costs related to further buildup of the new sales and marketing organization. EBITDA amounted to SEK 44 m (69). 

 

Despite the volatile macroeconomic sentiment, Perstorp has continued many of its development projects to prepare the organization to get back to the growth trajectory. The market approach has stepped up in pro-activity; communication via digital channels and social media has intensified and webinars have been held very successfully. The implementation of a new CRM-system has continued, which has given us new opportunities and tools to improve the way we work both in the relations with our customers as well as internally.

 

Perstorp has decided to postpone the construction of the new Penta plant in Gujarat, India. The lockdown situation in India has had a large impact on the construction site and the current demand situation is uncertain. All construction work is put on hold for the time being but the ambition is to resume full operations when the visibility for the future has improved and it is possible to resume work as planned.

 

In uncertain times like this, it is of great importance to protect the short term but also important to take the time to look at the bigger picture and possible opportunities and threats. I have taken a considerable amount of my time over the last two months to speak with a lot of people and institutions both within our industry and outside. All with the objective to try to set a framework and direction for our leaders to use when they in turn set the direction for the business going forward said the CEO.