Oxea GmbH

EANS-News: Oxea GmbH
Oxea reports record earnings for FY 2011 and solid Q4 performance


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annual report/quarterly report


Luxembourg (euro adhoc) - Highlights FY 2011:
* Net sales were EUR1,479 million versus EUR1,365 million in the prior year
period
* Adjusted EBITDA was EUR206 million versus EUR178 million in the prior year
period
* Cash generated by operating activities was EUR193 million versus EUR136
million in the prior year period
* Operating Profit was EUR180 million versus EUR141 million* in the prior year
period
* Net Income was EUR77 million versus EUR71 million* in the prior period

Oxea, a leading global supplier of Oxo intermediates and Oxo Derivatives, today
announced record results for FY 2011. Net sales of EUR1,479 million were up by
8% and Adjusted EBITDA amounted to EUR206 million reflecting an increase of 16%
from the corresponding period of the prior year. Strong cash generation during
the year significantly improved Oxea's financial profile and further reduced net
debt to ca. 1.7x Adjusted EBITDA from 2.2x in FY 2010. 

After a very strong first half year of 2011 with record performance in both
revenues and EBITDA and a robust third quarter, Oxea´s fourth quarter
performance was affected by the continued softening of the world economy and
destocking activities along the value chain in the entire industry. In a
challenging macroeconomic environment, Oxea´s fourth quarter revenues of EUR328
million decreased moderately by 6.5% compared to a strong Q4 2010. Adjusted
EBITDA in Q4 was EUR36 million compared to EUR45 million in the prior year
period. Despite lower fourth quarter operating results compared to the prior
year period, Oxea generated strong cash flows mainly due to a significant
improvement of Trade Working Capital leading to a cash balance of EUR125 million
at the end of the year compared to EUR24 million at the end of September 2011.



In EUR million        Three months ended   Twelve months ended 
Unaudited           December 31          December 31 
                    2011      2010       2011      2010 
------------------------------------------------------------
Net Sales          328.4     351.2    1,479.3   1,365.3 
Gross Profit        33.8      44.4      205.4     190.0 
SG&A               (10.0)    (11.0)     (37.6)    (46.9) 
R&D                 (1.8)     (1.3)      (6.4)     (5.5) 
Other operating 
income               9.7       4.0       18.1      43.3 
Operating Profit    31.7      36.1      179.5     180.9 
Net Income           8.7      24.3       77.0     111.1 
Adjusted EBITDA     35.5      44.9      206.2     177.6

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*adjusted for a net gain of EUR40 million from divesture in 2010


Sales
Sales for the three months ended December 31, 2011 were EUR328.4 million, a
decrease of 6.5% compared with the corresponding period of the prior year.
Overall, volumes were 6.4% lower than in the corresponding period of the prior
year mainly driven by destocking activities along the value chain in the entire
industry and production outages. Oxo Intermediates volumes and Oxo Derivatives
were 7.1% and 4.2% lower respectively than the corresponding period of the prior
year. Of our revenues for the three months ended December 31, 2011, EUR141
million resulted from sales in Europe, EUR109 million in North America and EUR78
million in the rest of the world compared to EUR183 million, EUR103 million and
EUR65 million respectively in the prior year period.

Gross profit
Gross profit for the three months ended December 31, 2011 amounted to EUR33.8
million compared with EUR44.4 million in the corresponding period of the prior
year. This development is mainly due to lower volumes such that gross profit
amounted to 10.3% of sales compared with 12.6% in the corresponding period of
the prior year.

Selling, general & administration expense (SG&A)
SG&A expense for the three months ended December 31, 2011 decreased to EUR10.0
million compared with EUR11.0 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 fourth quarter of 2010.

Other operating income/(expense) *
Net other operating income for the three months ended December 31, 2011 amounted
to EUR9.7million compared with a net other operating income of EUR4.0 million in
the corresponding period of the prior year. The increase is primarily
attributable to insurance gains.

Operating result
Operating result for the three months ended December 31, 2011 was EUR31.7
million compared with EUR36.1 million in the corresponding period of the prior
year period primarily as a result of lower revenues partly offset by lower SG&A
expense and higher other operating income.

Financial result *
Net financial expense increased to EUR15.0 million compared with EUR10.9 million
in the corresponding period of the prior year primarily as a result of exchange
rate losses in 2011 compared to exchange rate gains in 2010.


*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 income for the quarter ended December, 2010
has been reduced by EUR1.5 million and net financial expense has been decreased
by EUR1.5 million.


Net income
Net income was EUR8.7 million compared with EUR24.3 million in the corresponding
period of the prior year primarily attributable to a lower operating result as
mentioned above, higher net financial expense and higher income taxes. 

Adjusted EBITDA
Adjusted EBITDA at EUR35.5 million compared with EUR44.9 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 2011 Oxea
generated EUR193.3 million in cash from operating activities compared with
EUR135.6 million in the corresponding period of the prior year. Increased
earnings from operating activities and higher inflows from working capital were
partly offset by higher income tax payments. 

Cash used in investing activities was EUR36.2 million compared with an inflow of
EUR50.2 million driven by proceeds from divesture in the amount of EUR79.0
million in the corresponding period of the prior year. 

Cash used in financing activities in the amount of EUR130.7 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 EUR178.2 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 2011, Oxea generated revenue of about EUR1.5 billion with its 1,365 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
Communications/PR
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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