COLOMBES, France—Arkema S.A. reported an increase in sales and net income for the first quarter of 2016.
Net income increased 63 percent to about $121 million on $2.16 billion in sales, which also increased compared to $2.14 billion in 2015. The France-based specialty chemicals company also reported a 2.5 percent increase in sales volumes and attributed the sales largely to Bostik S.A.'s performance combined with the divestment of its Sunclear unit.
“This performance illustrates our internal momentum sustained by transforming investments which continue to ramp up, like Bostik integration and the development of thiochemicals in Malaysia,” Chairman and CEO Thierry Le Henaff said in a statement. “The successes of our innovation in new materials, as well as our operational excellence drive also continue to bear fruit. Arkema thus fully benefits from its strategy to expand in more resilient businesses and high added value niches along with its geographic presence now very well balanced.”
Sales increased by 17 percent to about $990.7 million in the firm largest segment—High Performance Materials—which houses its Bostik adhesives unit, including hot melt pressure sensitive adhesives produced with elastomers. Volumes increased 3.5 percent driven by innovations from lightweight materials and new energies. Arkema also credited Bostik's geographic expansion as a reason for the increase.
Bostik recently opened plants in Bangalore, India; and Monterray, Mexico. Its India facility came online in the third quarter of 2015 while Mexico recently opened in January. Both produce hot melt pressure sensitive adhesives for the disposable hygiene sector in each region. Bostik's hot melt pressure sensitive adhesives are based on styrene-block-copolymer thermoplastic rubbers with a tackifying resin.
The firm's Coating Solutions sales dropped 12.9 percent to $493.1 million despite increased volumes of 2 percent.
Its Industrial Specialties segment sales dropped 6.4 percent to $668.8 million. Sales volumes for the segment grew by 1.8 percent thanks to the contribution of the thiochemicals platform in Malaysia, which came online in the first quarter of 2015.
Arkema attributed the sales decline largely to the divestment of its plastic and aluminum sheet distribution business, Sunclear, to BF Invest completed in the fourth quarter of 2015. Arkema said in November 2015 that Sunclear represented about $205.4 million in sales.
The divestment of Sunclear is part of a program to divest nearly $800 million in sales to refocus on core businesses. On April 14, the firm announced its proposed divestment of its Activated Carbon and Filter Aid business to U.S.-based Calgon Carbon for $163 million. Arkema said the units represent about $106 million in sales and employ about 300 people.