Oxea GmbH

EANS-News: Oxea GmbH
Oxea Sarl reports robust third quarter results

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quarterly report/9-month report


Luxembourg (euro adhoc) - Third quarter highlights:
>> Net sales were EUR382.8 million, up 4% from the prior year period
>> Adjusted EBITDA was EUR48.6 million versus EUR50.8 million in the prior year
period
>> Operating Profit was EUR 43.9 million versus EUR 82,0 million (included EUR
39.7 million net gain from divestures) in the prior year period
>> Net Income was EUR 21.9 million versus EUR 50.5 million (incl. divestures) in
the prior period

Oxea Sarl, a leading global supplier of Oxo intermediate and Oxo Derivatives,
today announced third quarter net sales of EUR382.8 million, an increase of 4%
compared with the corresponding period of the prior year.

After a very strong first half year of 2011 with record performance in both
revenues and EBITDA, Oxea´s third quarter performance was affected by the
general seasonality of the industry and the overall softening of the world
economy. Notwithstanding the weak economic trend in the US and European regions
as well as in China, Oxea achieved an Adjusted EBITDA of EUR48.6 million and
increased revenues compared with the corresponding period of the prior year,
which again underlines the robustness of the business model. Operating Profit
and Net Income of the prior year period included a net gain of some EUR39.7
million on divestures. Under consideration of this exceptional item Operating
Profit of EUR43.9 million and Net Income of EUR21.9 million in the third quarter
of 2011 traded in line with the prior year period. Adjusted EBITDA for the nine
months ended September 2011 amounted to EUR170.7million reflecting an increase
of 29% from the corresponding period of the prior year and underlines the
continued excellent relationships with customers and the contribution of Oxea´s
employees to the success of the business. After the refinancing in July 2010 net
debt has been reduced to around 2.0x Adjusted EBITDA on an LTM basis as a result
of strong cash generation and excellent operating performance.


In EUR million - Unaudited


                Three months ended    Nine months ended
                    September 30,       September 30,
                  2011     2010       2011      2010
Net Sales        382.8    367.2    1,150.9   1,014.1
Gross Profit      48.5     56.7      171.5     145.6
SG&A              (8.4)   (13.9)     (27.6)    (35.9)
R&D               (1.6)    (1.3)      (4.6)     (4.2)
Other operating 
income/(expense)   5.4     40.4        8.5      39.3
Operating Profit  43.9     82.0      147.8     144.8
Net Income        21.9     50.5       68.3      86.8

Adjusted EBITDA   48.6     50.8      170.7     132.7


Sales

Sales for the three months ended September 30, 2011 were EUR382.8 million, an
increase of 4% compared with the corresponding period of the prior year. Lower
volumes were more than offset by the pass through of higher raw material costs
in sales prices to customers. Overall, volumes were some 4.3% lower than in the
corresponding period of the prior year. Oxo Intermediates volumes were some 3.7%
and Oxo Derivatives 5.6% lower than the corresponding period of the prior year
driven by production outages and lower volumes sold to European regions. Of our
revenues for the three months ended September 30, 2011, EUR176.0 million
resulted from sales in Europe, EUR120.0 million in North America and EUR86.8
million in the rest of the world compared to EUR181.4 million, EUR113.2 million
and EUR72.6 million respectively in the prior year period.

Gross profit
Gross profit for the three months ended September 30, 2011 amounted to EUR48.5
million compared with EUR56.7 million in the corresponding period of the prior
year. This development is due to lower volumes and increased raw material costs
such that gross profit amounted to 12.7% of sales compared with 15.4% in the
corresponding period of the prior year.

Selling general & administration expense (SG&A)
SG&A expense for the three months ended September 30, 2011 decreased to EUR8.4
million compared with EUR13.9 million in the corresponding period of the prior
year. The decrease is primarily attributable to higher consulting fees in
relation to projects and higher personnel costs including accruals for employee
bonuses in the third quarter of 2010.

Other operating income/(expense) *)
Net other operating income for the three months ended September 30, 2011
amounted to EUR5.4 million compared with a net other operating income of EUR40.5
million in the corresponding period of the prior year. The decrease is primarily
attributable to a net gain of some EUR39.7 million on divestures in the third
quarter of 2010 partly offset by an increased income from site services.

Operating result
Operating result for the three months ended September 30, 2011 was EUR43.9
million compared with EUR82.0 million in the corresponding period of the prior
year period primarily as a result of the net gain on divestures in the prior
year period.

Financial result *)
Net financial expense decreased to EUR10.8 million compared with EUR28.3 million
in the corresponding period of the prior year primarily as a result of costs
incurred in connection with the refinancing in July 2010 in the prior year
period.

*) Prior year numbers have been adjusted to reflect the reclassification of net
foreign exchange gains and losses from other operating income to financial
result. As a result, other operating expense for the quarter ended September 30,
2010 has been reduced by EUR4.3 million and net financial expense has been
increased by EUR4.3 million.

Net income
Net income was EUR21.9 million compared with EUR50.5 million in the
corresponding period of the prior year primarily attributable to net gains from
divestures in the prior year period and higher income taxes partly offset by
lower net financial expense as mentioned above. 

Adjusted EBITDA
Adjusted EBITDA at EUR48.6 million compared with EUR50.8 million in the
corresponding period of the prior year was driven by lower gross profit partly
offset by lower operating expenses.

Cash Flow
The company continued to generate positive free cash flow and during the first
nine months of 2011 Oxea generated EUR78.1 million in cash from operating
activities compared with EUR44.8 million in the corresponding period of the
prior year. Increased earnings were partly offset by higher income tax payments.


Cash used in investing activities was EUR21.6 million compared with an inflow of
EUR57.4 million driven by proceeds from divestures in the amount of EUR 79.0
million in the corresponding period of the prior year. 

Cash used in financing activities in the amount of EUR130.4 million was mainly
driven by the optional redemption of 5% of the Senior Secured Notes and a
payment to shareholders. In the corresponding period of the prior year cash used
in financing activities was EUR175.8 million whereby proceeds of EUR505.7
million from the bond issue in July 2010 were used to repay existing bank debt
and shareholder loans.


Oxea is a global manufacturer of Oxo Intermediates and Derivatives such as
alcohols, polyols, carboxylic acids, specialty esters and amines. These products
are sold in the merchant market (where sales are to third party customers) and
used for the production of high-quality coatings, lubricants, cosmetic and
pharmaceutical products, flavorings and fragrances, printing inks and plastics.
In the 12 months ending September 2011, Oxea generated revenue of about EUR1.5
billion with its approximately 1,350 employees in Europe, the Americas and Asia.


Forward looking statements
* This document contains financial information regarding the businesses and
assets of OXEA S.à r.l. (the "Company") and its consolidated subsidiaries (the
"Group"). Such financial information has not been audited, reviewed or verified
by any independent accounting firm. The inclusion of such financial information
in this document or any related presentation should not be regarded as a
representation or warranty by the Company, any of its respective affiliates,
advisors or representatives or any other person as to the accuracy or
completeness of such information´s portrayal of the financial condition or
results of operations by the Group.
* This document may contain information, data and predictions about our markets
and our competitive position. While we believe this data to be reliable, it has
not been independently verified, and we make no representation or warranty as to
the accuracy or completeness of such information set forth in this document.
Additionally, industry publications and reports from which such information,
data or predictions may be obtained generally state that the information
contained therein has been obtained from sources believed to be reliable but
that the accuracy and completeness of such information is not guaranteed and in
some instances state that they do not assume liability for such information. We
cannot therefore assure you of the accuracy and completeness of such information
and we have not independently verified such information. In addition, we have
made statements in this document regarding our industry and position in the
industry based on our experience and our own investigation of market conditions.
We cannot assure you that the assumptions underlying these statements are
accurate or correctly reflect the state and development of, or our position in,
the industry, and none of our internal surveys or information has been verified
by any independent sources.
* Certain statements in this document are forward-looking. By their nature,
forward-looking statements involve known and unknown risks and uncertainties
because they relate to events and depend on circumstances that may or may not
occur in the future. Forward-looking statements are not guarantees of future
performance. These factors include, among others: the cyclical and highly
variable nature of our business and its sensitivity to changes in supply and
demand; adverse and uncertain global economic conditions; the highly variable
nature of raw materials costs and any loss of key suppliers or supply shortages
or disruptions; the competitive nature of our industry; the ability to comply
with current or future laws and regulations relating to environmental, health
and safety matters as well as the safety of our products, related costs of
maintaining compliance and addressing liabilities as well as risks relating to
compliance with antitrust and tax laws; our reliance on a limited number of
suppliers for certain of our key raw materials; operational risks, including the
risk of environmental contamination and potential product liability claims;
operational interruptions at our facilities due to events that are outside of
our control such as severe weather conditions, unscheduled downtimes, terrorist
attacks, natural disasters or other events that may interrupt or damage our
operations or the impact of scheduled outages on our results of operations; the
risk that our insurance coverage may not be sufficient to cover all risks; risks
relating to the global nature of our operations, including, among others,
fluctuations in exchange rates; the loss of major customers or key customers for
certain of our products; the loss of key personnel; risks relating to
acquisitions and dispositions, including any impairment risks with respect to
historical acquisitions, our ability to successfully integrate acquired
businesses, and unexpected liabilities relating to such acquisitions or
contingent liabilities in connection with such dispositions; the requirement to
make further contributions to our pension schemes; the failure to protect our
intellectual property rights; limitations on our ability to adjust the quality
of certain products that we manufacture; and potential conflicts of interests
with our principal shareholder.
* These and other factors could adversely affect the outcome and financial
effects of the plans and events described herein. Forward-looking statements
contained in this document regarding past trends or activities should not be
taken as a representation that such trends or activities will continue in the
future. New risks can emerge from time to time, and it is not possible for us to
predict all such risks, nor can we assess the impact of all such risks on our
business or the extent to which any risks, or combination of risks and other
factors, may cause actual results to differ materially from those contained in
any forward-looking statements. Neither the Company nor the Group undertakes any
obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. You should not place
undue reliance on forward-looking statements, which speak only as of the date of
this document.

Use of non IFRS financial information:
* EBITDA is defined as net income for the year before financial result, income
taxes, depreciation and amortization. EBITDA, is a supplemental measure of our
performance and liquidity that is not required by or presented in accordance
with IFRS. EBITDA is not a measurement of our financial performance or liquidity
under IFRS and should not be considered as an alternative to profit for the
period presented, results from operating activities or any other performance
measures derived in accordance with IFRS or as an alternative to cash flow from
operating activities as a measure of our liquidity. We believe EBITDA
facilitates operating performance comparisons from period to period and company
to company by eliminating potential differences caused by variations in capital
structures (affecting interest expense), tax positions (such as the impact on
periods or companies of change in effective tax rates or net operating losses)
and the age and book value and amortization of tangible and intangible assets
(which have an effect on related depreciation expense). We also present EBITDA
because we believe it is frequently used by securities analysts, investors and
other interested parties in the evaluation of similar issuers, the majority of
which present EBITDA when reporting their results. Finally, we present EBITDA as
a measure of our ability to service our debt. 
* Adjusted EBITDA is defined as EBITDA adjusted to remove the effects of certain
non-cash and non-recurring expenses and charges. Adjusted EBITDA is a
supplemental measure of our performance and liquidity that is not required by or
presented in accordance with IFRS. Adjusted EBITDA is not a measurement of our
financial performance or liquidity under IFRS and should not be considered as an
alternative to profit for the period presented, results from operating
activities or any other performance measures derived in accordance with IFRS or
as an alternative to cash flow from operating activities as a measure of our
liquidity. We believe Adjusted EBITDA facilitates operating performance
comparisons from period to period and company to company by eliminating certain
non-recurring expenses and charges. We also present Adjusted EBITDA because we
believe it is frequently used by securities analysts, investors and other
interested parties in the evaluation of similar issuers. Finally, we present
Adjusted EBITDA as a measure of our ability to service our debt.


Further inquiry note:
Bernhard Spetsmann
Managing Director (Finance, IT)
bernhard.spetsmann@oxea-chemicals.com

Birgit Reichel
Global Communications
birgit.reichel@oxea-chemicals.com

end of announcement                               euro adhoc 
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company:     Oxea GmbH
             Otto-Roelen-Straße 3
             D-46147 Oberhausen
phone:       +49(0)208 693 3112
FAX:         +49(0)208 693 3101
mail:     birgit.reichel@oxea-chemicals.com
WWW:      http://www.oxea-chemicals.com
sector:      Chemicals
ISIN:        XS0523636594
indexes:     
stockmarkets: Open Market: Frankfurt 
language:   English
 



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