COVID-19 pandemic is likley to severely impact the whole year revenue gudiance due to which the company is focusing on mitigation and cash generation. 

 

The company achieved first half year 2020 continuing operations sales of CHF 1.945 billion, compared to CHF 2.229 billion in the first half year 2019. This corresponds to a decrease of 5% in local currency due to lower demand and 13% in Swiss francs, attributable to unfavourable currency developments.

 

The net result for the total Group increased to CHF 90 million profit versus a CHF 101 million loss in the first half of 2019. Excluding the above-mentioned one-off provision of CHF 231 million, the net result in the first half of 2020 was 31% lower than the previous year due to volume-driven weaker absolute profit and negative currency effects.

 

EBITDA margin improved to 15% compared to an operational performance of 14.9% in the first half of 2019. Net result for the total Group improved to CHF 90 million whereas Operating cash flow at CHF 89 million. 

 

“In the first half of the year, our continuing operations were particularly resilient and showed a strong performance in an admittedly challenging environment. Particularly the second quarter was negatively affected by influences attributable to the COVID-19 pandemic. In this difficult economic environment, our continuing operations even showed an improvement in margins. This clearly confirms the validity of our strategic decision to focus on Clariant’s three core specialty Business Areas,” said Hariolf Kottmann, Executive Chairman ad interim of Clariant. 

 

“Despite the uncertainties surrounding the current economic environment, the growth profile of our core portfolio remains undiminished. We will continue to focus on mitigating the impact of this pandemic and will progress with Clariant’s transformation program. This will enable Clariant to realize above-market growth, higher profitability and stronger cash generation,” added Kottmann. 

 

The Group was confronted by a significantly lower demand environment in several segments in the first half year 2020 as a result of the COVID-19 pandemic. Therefore, these results are noteworthy and underpin the fact that measures to minimize the impact of this pandemic are fully in place based on a strong balance sheet and liquidity position. 

 

In the first half year, the Middle East & Africa as well as Asia remained resilient, with China and Southeast Asia demonstrating solid growth. Sales in Latin America increased in local currency, while Europe and North America weakened more significantly due to demand declines across all Business Areas.

 

In the first half 2020, Care Chemicals sales declined by 6% in local currency due to weather-related weak Aviation demand in the first quarter, which could not be compensated for by the strong expansion in Consumer Care in the second quarter. The Catalysis Business Area’s top line declined by 4% in local currency amid the temporarily muted demand environment in the chemical industry, whereas the second quarter improved over the first. 

 

Natural Resources was impacted by the weakening end-market demand and pressure on volumes in Oil and Mining Services in the second quarter in particular. This resulted in a sales decline of 5% in local currency in the first half of 2020.