MUNICH (dpa-AFX) - Wacker Chemie AG (WKCMY.PK, WKCMF.PK) reported that its Group net income for the fiscal year 2018 dropped to 260.1 million euros from 884.8 million euros in 2017. In 2017, net income included proceeds of 634.7 million euros from the deconsolidation of Siltronic as a WACKER segment. Earnings per share were 4.95 euros, down from 17.45 euros last year.
Income from continuing operations climbed 4 percent in 2018 to 260.1 million euros from 250.1 million euros in 2017.
'From today's perspective, 2019 is not going to be an easy year..For our chemical divisions, we are confident that our excellent products will keep us on our growth path. On the other hand, solar-grade polysilicon overcapacities in China are slowing the earnings trend at our polysilicon business - and thus at the Group - despite our leading market and quality position,' said CEO Rudolf Staudigl in Munich on Tuesday.
EBITDA or earnings before interest, taxes, depreciation and amortization totaled 930.0 million euros in 2018, compared to 1.01 billion euros in 2017. That was 8 percent less than the year before and corresponded to an EBITDA margin of 18.7 percent (2017: 20.6 percent). The decline was mainly due to business-interruption costs at the Charleston site (USA) and the fact that insurance compensation for the loss event was still pending. Higher raw-material and energy costs also dampened earnings significantly.
Group sales grew to 4.98 billion euros, up 1 percent year over year. The slight increase was fueled by higher volumes and prices in its chemical business, especially for silicones. As a result, WACKER more than offset not only the negative exchange-rate effects from the euro's strength against the US dollar, but also lower prices for polysilicon.
For the first-quarter of 2019, WACKER expects total Group sales to be at last year's level of 1.22 billion euros. Group EBITDA in the first-quarter of 2019 is likely to contract markedly, as lower average prices for the company's products and significantly higher energy prices are weighing on earnings.
WACKER forecasts continued growth for 2019, despite challenging underlying conditions. It aims to lift its sales by a mid-single-digit percentage. The Group's EBITDA is likely to decline 10 to 20 percent compared with 2018. This is due to lower average prices for polysilicon, decreasing prices for standard products, and rising energy costs. Net income is projected to be significantly lower than a year ago.
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