WACKER ends 2017 with Substantial Sales and Earnings Growth
- FULL-YEAR 2017 GROUP SALES CLIMB 6 PERCENT TO €4.92 BILLION
- EBITDA OF €1.015 BILLION COMES IN 6 PERCENT HIGHER YEAR OVER YEAR (NOT INCLUDING PAYMENTS
FROM INSURERS FOR THE INCIDENT AT THE TENNESSEE SITE)
- SALES FOR Q4 2017 GROW TO €1.18 BILLION, 3 PERCENT MORE VERSUS A YEAR EARLIER
- FINAL-QUARTER EBITDA CLIMBS 6 PERCENT TO €235 MILLION
- EBIT INCREASES 24 PERCENT TO €420 MILLION IN 2017
- INCOME FROM CONTINUING OPERATIONS CLIMBS 40 PERCENT TO €250 MILLION, WITH NET INCOME
FOR THE YEAR TOTALING €885 MILLION
- NET CASH FLOW REACHES ABOUT €360 MILLION IN 2017
Munich , Feb 08, 2018
Following a good fourth quarter, Wacker Chemie AG achieved its sales and earnings
targets for full-year 2017. According to preliminary figures, the Munich-based chemical
group’s reporting-year sales came in at €4.92 billion (2016: €4.63 billion), up some
6 percent versus 2016. The increase was primarily due to higher volumes. Sales grew
at both chemicals and polysilicon businesses compared to the previous year. The rise
was particularly strong for silicones.
The Group’s preliminary EBITDA (earnings before interest, taxes, depreciation and
amortization) reached €1.015 billion in 2017 (2016: €956 million), 6 percent more
than the year before. In addition to the strong business trend, the increase was supported
by WACKER’s equity-accounted investment in Siltronic AG. In the past fiscal year,
WACKER did not yet receive any significant payments from insurers for the incident
at the Charleston site. EBIT (earnings before interest and taxes) came in at €420
million (2016: €338 million), a year-over-year rise of 24 percent. A further positive
effect here was the continued decline of depreciation, to about €590 million in 2017
(2016: €618 million).
Income from continuing operations climbed 40 percent to about €250 million in 2017
(2016: €178 million). WACKER posted preliminary net income for the year of €885 million
(2016: €189 million). It included income of €635 million from discontinued operations
from Q1 2017. This amount comprises the gain from deconsolidation of Siltronic as
a WACKER Group segment and Siltronic AG’s net income in the first quarter of 2017.
“Thanks to very robust customer demand at both our chemical and polysilicon businesses,
we continued to expand sales and earnings in 2017,” said Group CEO Rudolf Staudigl
in Munich on Thursday. “We more than compensated for the marked headwinds caused by
higher raw-material prices and by the euro’s strength in the second half-year. Looking
back at the full year, we met or surpassed our projections for every performance indicator.”
Investments, Net Cash Flow and Net Financial Debt
WACKER’s capital expenditures amounted to €325 million in 2017 (2016: €338 million)
according to preliminary figures, a decline of 4 percent. Investment projects included
new facilities for downstream silicone products in South Korea and Brazil, the expansion
of silicon-metal production at the Holla plant in Norway, construction of a new pyrogenic
silica plant at the Charleston site in the USA, and production-capacity expansion
for dispersions and dispersible polymer powders at the Burghausen and Nanjing sites.
Net cash flow from continuing operations totaled around €360 million in 2017 (2016:
€361 million), thus matching last year’s level. Net financial debt dropped substantially
as expected. It amounted to €455 million as of December 31, 2017 (Dec. 31, 2016: €993
Business Performance in Q4 2017
WACKER closed the fourth quarter of 2017 with gains in sales and EBITDA. Group sales
from October through December 2017 totaled around €1.18 billion (Q4 2016: €1.15 billion).
That was 3 percent higher, despite the euro being clearly stronger toward year-end.
EBITDA reached €235 million in Q4 2017 (Q4 2016: €221 million), a rise of 6 percent.
WACKER’s business in the final quarter was mainly spurred by robust customer demand
for silicones and polymer products. WACKER SILICONES grew its Q4 2017 sales to €535
million (Q4 2016: €492 million), surpassing the prior-year figure by 9 percent. WACKER
POLYMERS posted sales of €285 million (Q4 2016: €275 million). That was an increase
of 4 percent. At WACKER BIOSOLUTIONS, Q4 2017 sales of €50 million matched the prior-year
level (Q4 2016: €50 million).
On balance, EBITDA at the chemical divisions also grew in Q4 2017. It was positively
influenced by higher volumes, by better prices for silicone products and by ongoing
efficiency programs. WACKER SILICONES posted EBITDA of €100 million in the final quarter
of 2017 (Q4 2016: €79 million). That was a gain of 27 percent. EBITDA at WACKER POLYMERS
was €35 million (Q4 2016: €45 million). The main factor behind the 22 percent decline
was a significant year-over-year rise in prices for the raw materials vinyl acetate
monomer and ethylene. WACKER BIOSOLUTIONS reported EBITDA of €8 million in Q4 2017
(Q4 2016: €7 million).
From October through December 2017, WACKER POLYSILICON generated sales of €270 million
(Q4 2016: €297 million). The prime cause of this 9-percent drop was lower volumes.
The division had less polysilicon available for sale in Q4 2017 than a year earlier
due to the production shutdown at Charleston in the USA.
WACKER POLYSILICON’s year-over-year EBITDA decreased 25 percent to €65 million (Q4
2016: €87 million). In Q4 2016, EBITDA included special income of €13 million from
advance payments retained and damages received from solar-sector customers. No such
special income occurred in the final quarter of 2017. The division’s fourth-quarter
EBITDA did not yet include any significant payments from insurers for the incident
at the Charleston site.
The Q4 2017 and fiscal 2017 figures and business trends in this press release are
preliminary. Wacker Chemie AG will publish its Q4 Report and Annual Report 2017 on
March 13, 2018.