Segment Information
| Performance Rubber | Q1 2006 | Q1 2007 | Change | ||
|---|---|---|---|---|---|
| € million | % of sales | € million | % of sales | % |
Sales | 438 | 451 |
| 3.0 | |
EBITDA pre exceptionals | 71 | 16.2 | 70 | 15.5 | (1.4) |
EBITDA | 70 | 16.0 | 70 | 15.5 | 0.0 |
Operating result (EBIT) pre exceptionals | 55 | 12.6 | 53 | 11.8 | (3.6) |
Operating result (EBIT) | 54 | 12.3 | 53 | 11.8 | (1.9) |
Capital expenditures* | 10 |
| 13 |
| 30.0 |
Depreciation and amortization | 16 |
| 17 |
| 6.3 |
* intangible assets and property, plant and equipment
Sales in the Performance Rubber segment in the first quarter of 2007 grew by 3.0% to €451 million. Further increases in petrochemical feedstock costs were passed along to the market through higher prices, giving a 4.8% positive effect on segment sales. Volumes were up by 4.1%, while shifts in exchange rates had a 5.9% negative effect. Volumes in the Butyl Rubber business unit rose considerably following the success of efficiency-enhancing and capacity-expanding measures to meet heightened demand for our butyl products. In addition, higher prices for feedstocks, particularly isobutylene, were passed on to the market. The Polybutadiene Rubber business unit achieved slight price and volume increases, with sales growth recorded in Asia-Pacific. By contrast, the weakness in the North American automotive economy that has persisted since mid-2006 hampered business in the Americas region. In the Technical Rubber Products business unit, price increases were implemented but sales were diminished by adherence to our price-before-volume strategy and currency effects were negative.
EBITDA pre exceptionals for the Performance Rubber segment came in at €70 million, level with the prior year. The Butyl Rubber business unit lifted profitability thanks to efficiency improvements. In the Polybutadiene Rubber business unit, it was not possible to pass on the full impact of raw material cost increases to the market. Cost-cutting measures implemented in the past had a positive effect on earnings in the Technical Rubber Products business unit, which matched the prior-year quarter. The segment’s 15.5% EBITDA margin was at the very pleasing level of the first quarter of 2006.
| Engineering Plastics | Q1 2006 | Q1 2007 | Change | ||
|---|---|---|---|---|---|
| € million | % of sales | € million | % of sales | % |
Sales | 456 | 428 | (6.1) | ||
EBITDA pre exceptionals | 22 | 4.8 | 41 | 9.6 | 86.4 |
EBITDA | 22 | 4.8 | 41 | 9.6 | 86.4 |
Operating result (EBIT) pre exceptionals | 14 | 3.1 | 33 | 7.7 | > 100 |
Operating result (EBIT) | 14 | 3.1 | 33 | 7.7 | > 100 |
Capital expenditures* | 5 |
| 12 |
| > 100 |
Depreciation and amortization | 8 |
| 8 |
| 0.0 |
* intangible assets and property, plant and equipment
Sales in the Engineering Plastics segment fell 6.1% to €428 million in the first quarter of 2007 due to portfolio changes and currency effects. After adjusting for currency effects and the sales of the Fibers business unit, which was divested in the first quarter of 2006, the segment’s sales remained at the previous year’s level. Positive price effects of 6.4% almost completely offset negative volume effects of 6.6%.
The drop in volume in the Lustran Polymers business unit was a consequence of site consolidation, the divestment of the SAN plastics business in the prior year and the strategy of deliberately forgoing unprofitable business. Weaker demand in the Americaswas not fully offset by the ongoing expansion of the ABS plastics business in the Asia-Pacific region. Price increases were implemented in Europe and Asia, driven by the rise in raw material costs. Selling prices in the Semi-Crystalline Products business unit were raised on account of higher raw material prices, leading to an increase in revenues. Sales in Asia were boosted by the full commissioning of our new facility in Wuxi, China.