Significant growth in sales and revenue: LANXESS raises its fiscal 2021 forecast again

●Full-year EBITDA guidance raised to EUR 1 billion to EUR 1.
05 billion

● Sales in the second quarter increased by 27.
5% to 1.
831 billion euros

● Earnings before interest, tax, depreciation and amortization in the regular business area increased by 23.
7% year-on-year to 277 million euros

● Continue to grow: Complete the acquisition of Emerald Kalama Chemical

Shanghai, August 12, 2021 – LANXESS has once again raised its full-year 2021 forecast after a good second quarter
.
The specialty chemicals company expects earnings before interest, tax, depreciation and amortisation in the regular business range of 1 billion to 1.
05 billion euros this year
.
This guidance target also reflects the acquisition of Emerald Kalama Chemical
.
The acquisition, which was completed in early August, could contribute to EBITDA of around 35 million euros for the remainder of 2021
.
Previously, Lanxess expected revenue of 950 million to 1 billion euros in 2021
.

Compared with the same period of the previous year, which was affected by the epidemic, LANXESS reported a significant increase in EBITDA in the second quarter: revenue increased from 224 million euros to 277 million euros, an increase of 23.
7%
.
This positive development was driven by growing demand from the automotive industry, with the Engineering Materials business segment benefiting in particular
.
The consumer protection business segment was also strong, with revenues almost reaching the high levels of the previous year
.
By adjusting its selling prices, LANXESS has largely offset the sharp rise in raw material prices across its business segments
.
Currency effects (especially in the U.
S.
dollar), high freight rates and rising energy costs (especially in Germany) all had a negative impact on revenue
.
The EBITDA margin in the regular business area was 15.
1%, slightly lower than the 15.
6% in the same period last year
.

“Our business continued to perform well in the second quarter, with sales volumes returning to pre-pandemic levels, and we are confident in the second half of the year
.
With this momentum and the successful acquisition of Emerald Kalama Chemical, we are able to accelerate growth again , and raise the guidance target for the whole year,
" said Chang Mutian, Chairman of the Board of Management of LANXESS Group
.

In the second quarter, LANXESS's sales rose 27.
5 percent to 1.
831 billion euros from 1.
436 billion euros in the previous year
.
As expected, net income from continuing operations was significantly lower than the previous year's 803 million euros, at just 77 million euros
.
In the second quarter of 2020, LANXESS sold its stake in chemical park operator Currenta for a considerable gain
.

Acquisitions drive growth in Consumer Protection segment

Last week, LANXESS just completed the second largest acquisition in its history
.
The acquisition of Emerald Kalama Chemical strengthens the specialty chemicals company's position in high-growth markets and opens up new high-margin applications, particularly in consumer protection, which include flavor and fragrance products and applications in food and beverage or Antiseptic for cleaning and cosmetic products
.
LANXESS expects to quickly complete the integration of the new business
.
The acquisition will contribute approximately EUR 35 million to LANXESS' annual results in fiscal 2021
.

Business Sector: Growing Demand Drives Revenue

The High Quality Intermediates segment benefited from strong demand and correspondingly higher volumes
.
Thanks to higher selling prices, sales in this segment reached EUR 505 million, 17.
4% higher than the previous year's EUR 430 million
.
EBITDA decreased by 6.
8% from EUR 103 million to EUR 96 million due to higher energy and freight costs
.
In addition, revenue in the first quarter of the previous year also benefited from a positive price effect, as lower raw material prices did not have an immediate impact on the market
.
The profit before interest, tax, depreciation and amortization in the ordinary business area decreased correspondingly to 19.
0% from 24.
0% in the same period of the previous year
.

In the Specialty Additives business segment, the significantly higher performance reflects increasingly strong demand
.
Sales volumes have increased significantly, and raw material costs have also resulted in higher product prices than the previous year
.
Unfavorable exchange rate effects had a negative impact
.
Sales rose from 442 million euros to 568 million euros, an increase of 28.
5%
.
Earnings before interest, tax, depreciation and amortization in the regular business area were 89 million euros, 48.
3% higher than the 60 million euros in the same period of the previous year
.
The profit before interest, tax, depreciation and amortization in the regular business area increased from 13.
6% to 15.
7%
.

In the second quarter, both sales and revenue in the Consumer Protection business segment reached strong levels from the prior-year period
.
The continued good momentum of Saltigo's agrochemicals business and the high demand for disinfectants in the Material Protection Products business unit contributed to the increase in sales
.
After LANXESS acquired INTACE and Theseo, the businesses of these two companies also contributed positively
.
Unfavorable currency effects impacted sales and revenue
.
Sales rose from 301 million euros to 314 million euros, an increase of 4.
3%
.
EBITDA in the regular business area was 65 million euros, 4.
4% lower than the previous year's 68 million euros, due to higher energy and freight costs and price effects
.
The EBITDA margin in the ordinary business area reached 20.
7%, compared with 22.
6% in the previous year
.

The Engineering Materials business segment recorded a significant increase in sales, benefiting from increasingly strong demand from the automotive industry
.
Product prices are also higher than the same period last year, which was severely affected by the epidemic
.
The exchange rate showed negative growth
.
Sales in the second quarter increased by 73.
8% from 244 million euros to 424 million euros
.
Despite higher freight and energy costs and the absence of a key supplier, EBITDA in the regular business area reached EUR 68 million, 142.
9% higher than EUR 28 million in the same period last year
.
The profit before interest, tax, depreciation and amortization in the ordinary business area increased from 11.
5% to 16.
0%
.

*As of December 31, 2020

**Number of employees employed in continuing operations as of reporting date