DUSSELDORF, Germany (Nov. 9)—Degussa A.G. reported double-digit hikes in sales and earnings across its chemicals businesses in the third quarter on the strength of volume increases and higher selling prices.
The good results came despite energy costs for natural gas and electricity, which have risen 12 percent this year with an anticipated increase of 20 percent for 2006.
Degussa derives about 19 percent of its sales from its Coatings and Advanced Fillers division, which includes its carbon black, silica and silanes operating units. The chemicals group's sales grew 12 percent in the quarter to $3.7 billion and 8 percent for the nine months to $10.5 billion. Pretax earnings were up 10 percent in the quarter to $321.6 million and 2 percent for the nine months to $885.6 million.
The Coatings and Advanced Fillers business posted 4 percent higher sales in the quarter, but pretax operating profit dropped 16 percent. Part of this drop was attributed to the Advanced Fillers and Pigments segment, which makes fillers, where "price rises did not fully compensate for the sharp rise in raw materials and energy costs," the firm said.
Referring to the "drastic increase" in energy and raw materials prices as developments causing concern, Degussa said the price for the oil needed to make the tire and rubber filler carbon black has risen by double-digit rates this year, along with that of other key materials.