Wacker notes improved silicones demand in Q1

MUNICH, Germany—Wacker Chemie A.G. reported tentative signs of recovery, after posting declines in sales and earnings within its silicones division for the quarter ended March 31.

Earnings (EBITDA) fell 15 percent year-on-year to $87.5 million, on a 7-percent decrease in silicones sales to about $768 million, according to Wacker's latest quarterly statement.

Quarter-on-quarter, however, both sales and earnings were up, as the division more than doubled earnings and increased revenue by 17 percent.

In its April 25 results announcement, the German group linked the weaker year-on-year performance mainly to lower prices.

Sequential growth was attributed to higher sales, higher plant-utilization rates, lower raw-material prices and positive investment income.

Overall, Wacker said it noticed both year-on-year and quarter-on-quarter improvement in demand for silicone specialties, mainly on customer restocking.

Prices for standard grade silicones, however, remain at a low level, Wacker noted.

"As expected, the ongoing economic downturn and lower selling prices are reflected in our figures," Wacker President and CEO Christian Hartel said in a statement. But in terms of demand, "customers have started to replenish their inventories from the recently very low levels."

"The demand for silicones in particular trended upward in the first quarter," Hartel said, "but this cannot yet be seen as a distinct sign of a lasting turnaround."